Bearish Threat in Eurostoxx 50 Futures Remains Present

A bearish threat in Eurostoxx 50 futures remains present following last week’s sharp sell-off from 4513.00, the Jul 31 high. Price has cleared both the 20- and 50-day EMAs, highlighting a stronger bearish theme. Note too, that key support at 4331.00, the Jul 26 low, has been cleared. This strengthens current conditions and opens 4220.00, the Jul 7 low and a reversal trigger. Initial firm resistance is at 4424.00, the Aug 2 high. Bearish conditions in the E-mini S&P contract remain intact. Last week’s sell-off reinforced a bearish threat and resulted in a break of support at the 20-day EMA. The recent failure at the top of the bull channel also highlights a bearish development and the risk of an extension lower near-term. Further downside would open 4457.21, the 50-day EMA. First key resistance is at 4634.50, the Jul 27 high.

• Japan's NIKKEI closed higher by 122.73 pts or +0.38% at 32377.29 and the TOPIX ended 7.8 pts higher or +0.34% at 2291.73.
• Elsewhere, in China the SHANGHAI closed lower by 8.211 pts or -0.25% at 3260.62 and the HANG SENG ended 353.75 pts lower or -1.81% at 19184.17.
• Across Europe, Germany's DAX trades lower by 62.71 pts or -0.39% at 15888.33, FTSE 100 lower by 20.25 pts or -0.27% at 7534.2, CAC 40 down 25.37 pts or -0.35% at 7294.39 and Euro Stoxx 50 down 26.09 pts or -0.6% at 4311.41.
• Dow Jones mini down 89 pts or -0.25% at 35465, S&P 500 mini down 14.5 pts or -0.32% at 4523, NASDAQ mini down 60 pts or -0.39% at 15425.5.