US equities lower again, Europe strengthening into tonight's ECB meeting, oil spread narrows, ASX futures down 1 point

We could be in for some healthy profit taking in equities in coming days. This week the RBA didn't give the Australian market what it wanted, and last night US stocks put in a second night of poor performance, which combined have really flattened out the February rally in both markets and we are now breaking out of a short-term trend channel. Looks to be nothing too alarming, if anything (certainly with regard to the Australian market) the short-term rallies both markets were overdone and we could easily see the S&P 500 (black line in the first chart) pull back to the 2,050 level and the ASX 200 (orange line) find a range between 5,500 and 6,000 until the potential of an April/May rate cut gives Australian equities another kick higher.

European equities, on the other hand, continue to perform very strongly. Today's last chart shows the German DAX (DAX.I), Italian MIB (SPMIB.I) and French CAC (CAC40.I) all up well over 15% for the year to date. Now European equities may not experience a straight line 2015 rally, but they're certainly poised to continue performing, due in large part to the quantitative easing that will take place there (which will likely heat up once the Greek cooperation issues are finalised). One Rivkin member pointed this out in last week's Virtually Live Global show (click here to view), putting forward the rationale (and I'm paraphrasing) that US equities benefited greatly from quantitative easing, why shouldn't Europe? While at the time I found plenty of reasons why the two situations were very different, I must say the more I consider this, the more I tend to think (even though it might seem such an obvious trade) that Europe might be place to be in 2015. I would urge all members to open either a Rivkin Trader live or demo account to get familiar with the concept of trading foreign equities, because I'm quite sure we'll be releasing a European Blue Chip portfolio in coming weeks for those keen to get exposure to the possibility of rising equity markets there. Email info@rivkin.com.au or phone a Rivkin Relationship manager on 1300 748 546 now to get things rolling so you can be set up in time for this. If you're happy to get started straight away (the European Central Bank is meeting tonight), we can produce a 10-stock model portfolio any time. Just phone and ask for Jonathan Casey.

In today's second chart I have illustrated the disparity between WTI (OILUS) and Brent (OILUK) crude, picking up on a theme that I have been referring to for a little while now. Excess inventories of crude  in the US drove the price of WTI crude lower over the last month or so, but this gap seems to be narrowing. There is still a ~9% year to date disparity in performance, and if you'd like to take the view that the spread between these two prices will narrow, please enquire about selling the front-month OILUK CFD and buying the front-month OILUS CFD for a market-neutral bet.

The US dollar index strength last night was very much a function of euro weakness, and as a result the Aussie dollar held up well - trading at US$0.7820.

Today‚Äôs charts are taken from the Rivkin Trader platform. 30,000 global instruments available to trade including FX, commodities, index, ETFs and international shares. Trade Australian share CFDs from just $8 or 0.10%. Click here or phone 1300 748 546 to get your free $100,000 demo account.

Upcoming economic announcements: Australian retail sales and trade balance out at 11:30am, Bank of England rate decision at 11pm, ECB rate decision and press conference at 11:45pm and then 12:30am, all Sydney time.

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