Technicals | Jul 22 2011
By Rudi Filapek-Vandyck
Note technical market analysts at Barclays: thus far, the summer of 2011 (Northern Hemisphere) is playing out almost exactly in the same manner as in the two previous summers of 2010 and 2009. The scenario that tends to unfold, now three times in a row, is that global equities peak, retreat, sink below technical resistance, bounce a few times and come back to retest resistance, but ultimately the positive undertone prevails and what follows is a rally to higher highs. So far this is pretty much what we have witnessed post April this year.
Given the similarities with 2009 and 2010, this is seen as a positive as it fuels the widely held expectation that things will look a lot better once autumn is upon us.
Barclays analysts chip in with the supportive observation that amidst all these movements, no damage has been done to the longer term uptrend underpinning equities at the moment.
The team also sticks with its positive view on energy markets, with the analysts awaiting a decisive break above US$100/bbl in WTI, while for Brent crude they expect a break above US$119.50 to target US$120.60, then the US$127.00/bbl high.
Gold looks ripe for short term consolidation, but the analysts have a target of US$1635/oz (US$43/oz for silver) and would thus be looking to buy on dips.
Technical limitations
If you are reading this story through a third party distribution channel and you cannot see charts included, we apologise, but technical limitations are to blame.
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