Weekend Outlook - SPY, QQQQ, DAX and ATX

Despite the disappointing jobs report the indices closed in positive territory on Friday.
First let's take a look at the SPY (ETF which tracks S&P 500).
On the daily chart you can see the downtrend from April until July. This trend was retested around support at the 104 level in August. Afterwards the uptrend until November started. This uptrend broke two weeks ago and was retested during the last two trading sessions, like in August right around former resistance. That would be the bearish case for the stock market. The bullish case would be that the SPY retested the 50 day moving average around 118 and started the next leg of the rally. Technically we are at a critical level.

The hourly chart of the SPY shows the break of the upward trendline even better. Yesterday the SPY completed the retest and what is very important for every short-seller out there that none of the three big US-Indices took out the highs of November.

The QQQQ (ETF which tracks the NASDAQ 100) did not retest the former uptrend and is still forming a potential bear flag. Only if the QQQQ takes out the November highs this scenario is off the table.

The hourly chart shows that the QQQQ is at its upper trendline and seems to be a little bit overbought.

The German DAX and the EUROSTOXX 50 were forming a negative doji star formation with a long white/green candle on Thursday followed by doji candle on Friday.
Further the DAX is just around the long term upper trendline which is very strong resistance.
A break below 6650 would indicate a retest of the breakout area around 6350.

The ATX (Austrian Traded Index) also run into resistance around 2750 to 2800 and now is forming some kind of a broadening top which usually occurs after an uptrend and is a reversal pattern.

The higher participation of private investors typically is a sign of a market top. Many sentiment indicators are at multi-year highs. The German TecDAX sentiment indicator for instance shows 65% of the private investors are bullish and just 20% are bearish. The AAII-Sentiment Survey shows similar results and the DAX sentiment too. In conclusion I think it is difficult to push the stock market above these strong resistance levels with such a bullish sentiment.

As always, please feel free to leave comments!