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Trend Conditions Improving for Equity Indices

EQUITY TECHS
  • Long-held trends across fixed income, currency and equity markets have begun to fade over the past week or so, with the market reaction to the payrolls release on Friday exacerbating the moves:
  • The e-mini S&P trades higher for a fifth consecutive session, with the index narrowing in on the cluster of resistance at the 50/100-dmas for the Dec contract. Overall, a bear cycle remains in play, but downside momentum has paused in favour of a corrective rally.
  • Eurostoxx 50 futures continue to push back against the recent bearish trend condition. Friday’s rally and the follow through early this week is, for now, deemed corrective in nature. Signs of further strength and a bottoming of prices would follow a break back above the 50-day EMA at 4258.4.

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