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European Equities, Inflation, Crypto Talking Points
- ECB Forum Continues, Fed, ECB and Bank of England Stick to Tough Stance
- CAC 40, IBEX 35 and EU Stoxx close in red, but DAX 40 leads
- Bitcoin (BTC/USD) trades sideways while Ethereum stabilizes at $1,100
Europe Fundamentals, ECB Forum and Inflation Fears Drive Stocks, Crypto Lower
Major stock indexes are struggling to find their feet as recession fears rapidly mount. Optimism surrounding China’s easing of Covid-19 restrictions was overshadowed by growing recession fears, weighing on risk assets after a modest rebound in stocks and cryptocurrencies earlier this week.
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Fed Chair Jerome Powell, ECB President Christine Lagarde and Bank of England (Bank of England) Governor Andrew Bailey maintained Aggressive rhetoric and underscored their commitment to restoring price stability despite the current events.
For European equities, growing tensions between the EU and Russia and an “energy shock” from a heightened war remained the main drag on stocks and indices, as sentiment was boosted by tighter monetary policy.
European Equities Price Action
With the German DAX (DE40), EUR STOXX 50 and Spain IBEX 35 all in the red, the EUR STOXX 600 has retreated to key support at 410, while the French CAC 40 is returning to the psychological 6,000 area. If Stoxx 600 breaks below 410, a break below 406 (38.2% Fibonacci of 2020-2022 swing) could open the door for 400 (June low), with further bearish momentum taking prices back to December 2020 The low drift of the month is 380 .
EURO STOXX 600 Weekly Chart
Source: TradingView, chart provided by Tammy Da Costa
Just as equity bulls are hampered by fundamentals, Bitcoin remains range-bound, with sellers determined to extend $20,000, paving the way for a possible retest of the June low of $17,567.
Bitcoin (BTC/USD) daily chart
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