Equity markets have started to look a little bit shaky as concerns over China have started to impact US stocks for the worse.

We are right in the middle of earnings season, the period of time where companies report their quarterly numbers and give guidance going forward.

Two of the big name companies reported yesterday and their weak results were blamed solely on a slowdown in China. Both Caterpillar and Nvidia left the market a little unhappy with their outlook and it is clear the trade wars are starting to bite. Along with the general Chinese slowdown that we are seeing.

There are a number of big events later this week that will give us an insight into the US economy, particularly US employment on Friday. And of course, we have the FOMC meeting where rates are expected to remain on hold.

So far today the ES is down -0.45% and slowly falling away in Asian trade.

Technical Outlook

The SPX is holding between the 2600 and 2700 level as it has done for a number of weeks now.

However, the cracks are now clearly starting to appear. All was happy on the surface since the post-Christmas rally, but there continues to be some underlying concerns at the moment.

S2 is now 2500, with R1 at the 2700 level.