SG SESSION (Bearish Wedge Formation In Play)
The Straits Times Index (STI) staged a strong rally of +2.8% (+78.31 points) during the week, breaking out of the range of 2,880 resistance and 2,830 window support zone as highlighted last week.
However, STI is currently displaying a Bearish Wedge Chart Pattern awaiting for breakdown of price.
The levels to watch for the week are 2,905 resistance turned support level, along with this year’s all time high level at 2,965 (immediate resistance).
US SESSION (Breakout to All Time High With Weakening Volume)
The S&P500 rallied +1.5% (+31.84 points), extending its 3rd consecutive week of of this bull run.
At the current junction, S&P 500 has broken its all time high level but closed with sequences of Bearish Reversal Candlestick Pattern over the past three session. This breakout has also reflected several weakness eg. RSI Bearish Divergence, diminishing Volume as price tread higher. This is an indication of potential weakness in this existing rally.
The levels to watch for the week are 2,135 all time high resistance turned support level.
5 things to watch on the economic calendar this week (an extract and summary from (http://www.investing.com/news/economy-news/5-things-to-watch-on-the-economic-calendar-this-week-414801)
1. European Central Bank policy meeting (Thursday)
The consensus is that the ECB will leave interest rates on hold, while Draghi is forecast to strike a dovish tone and perhaps hint at further stimulus to offset the hit to the economy from Britain’s decision to leave the European Union.
2. Flash euro zone PMIs for June (Friday)
The euro zone is to publish preliminary data on manufacturing and service sector activity for July at 08:00GMT, or 4:00AM ET, on Friday, amid expectations for a modest decline.
Ahead of the euro zone PMI’s, France and Germany will release their own PMI reports at 07:00GMT and 07:30GMT respectively.
3. German ZEW business survey (Tuesday)
The ZEW Institute will publish its July German business climate index at 09:00GMT, or 5:00AM ET, on Tuesday, amid expectations for a sharp deterioration from 19.2 to 9.1, as the Brexit shock hit business confidence. The current conditions index is also forecast to decline, from 54.5 to 52.0.
4. U.K. CPI, employment & retail sales data (Tuesday)
Analysts expect consumer prices to rise 0.4%, after increasing 0.3% a month earlier.
At 08:30GMT, or 4:30AM ET, Wednesday, the ONS will publish the latest jobs report. The amount of people receiving jobless benefits is expected to rise by 4,000 in June, with theunemployment rate holding steady at 5.0%, while wage growth including bonuses is forecast to rise 2.3%.
On Thursday, the ONS will produce a report on June retail sales at 08:30GMT, or 4:30AM ET, amid expectations for a decline of 0.6% last month. Core sales are forecast to fall 0.7%, as British consumers are thought to have slowed down on their purchases both before and after the referendum.
The U.K. will close out the week with a reading on July manufacturing sector activity at 08:30GMT, or 4:30AM ET, Friday. The manufacturing PMI is forecast to inch down to 49.4 from 52.1 a month earlier.
The Bank of England held off from cutting rates last week, but hinted that it will ease monetary policy at its next meeting in August as it devises the exact size and nature of its stimulus measures.
5. U.S. housing data (Tuesday)
The data could show that permits rose 0.6%to 1.150 million last month, while housing starts are forecast to inch up 0.5% to 1.170 million.
On Thursday, the National Association of Realtors is to release data on existing home sales for June at 14:00GMT, or 10:00AM ET, amid forecasts for a decline of 0.7% to 5.47 million.