Geoff Wilkinson, Associate at Linear Investments, speaks on the post Brexit performance in key European indices, the outlook, and key levels ahead - Euro Stoxx Banks, Pan European banking index, Stoxx Basic Resources. Joined by Zak Mir, Technical Analyst at Zak’s Traders Cafe.
Key Quotes
“Some high moves in Tobacco companies and consumer durables and that is completely out of order..exceptionally overbought”
“Mining stocks not going down is a good thing. European banks have not enjoyed the Brexit vote. Got some key levels to look at.”
“Significant price distortions in market. Risk-on rally due to unwinding of Brexit driven safe haven flows.”
“Euro Stoxx banks – Falling channel, clear close above 90.00 levels required”
“Pan European banking index – Needs closing above 132.50. It is 15% off the lows, and has seen a lot of gains in the past 2-3 days.. interesting to see if investors have appetite for further highs”
“Stoxx Basic Resources – Very big head and shoulder formation seen in charts with the neckline at 322. Not a favourite time to buy when the RSI remains overbought. Bit sell-off in March and April both occurred when the RSI got into overbought territory. Very key resistance at 337.. if we get there we would be even more overbought and looking to sell”