Overnight we have seen Asian equities take a move higher after the BOJ maintained its asset purchasing program amid speculations that Minister Shinzo Abe might ease on efforts to end deflation. However on the back of last nights meeting we are likely to see the BOJ committing to continue open- ended asset purchases until the end of next year to stimulate the economy.
All eyes this morning focus on GDP data from France, Germany and the Eurozone. French and German data were released at 7am this morning and neither managed to excite the markets with both figures coming in below expectations and dragging the major European indicies lower after the open.
In the equity market yesterday we saw an unusual change of trend, as the US sold the major indicies from the opening bell, with the $DOW closing below that psychological 14000 level. The $SPX also traded in the same fashion but failed to test the 1515 level which has been touted by traders as the new upward support for $SPX. Traders seem to be looking at the 1525-1530 level as the level we might see a possible correction stem from, and we would favour a correction back to the 1450 level before making a move higher. It is also important to note as traders that we have the G7 meeting taking place and the market has been polluted by random headlines which have caused dramatic swings and created a choppy trading environment, stick to the fundamentals and your trading plan do not get caught up in these big swings as they have proved to be short lived and without any substance on a many occasions.
We will be waiting on the sidelines now to see the Italian and Eurozone GDP numbers due out at 9am and 10am respectively.
Happy Trading
@lowkeycapital
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