Sunday, January 23, 2011

Market Analysis - DAX, EUROSTOXX 50 and SMI

Welcome back to the weekend market outlook.
The action of this week was not bullish at all. The DAX broke out to new 52-week-highs but reversed it the other day and in the weekly chart you can see the doji candlestick with higher volume. I would consider shorting the DAX if it breaks this weeks lows around 7000.


The EUROSTOXX 50 had a stronger week but it is now at the top of the bearish wedge and also a declining line from the two tops from 2010 is there. The analysis is still the same, as long as it does not break last year's highs around 3050 I remain bearish. Moreover the RSI is not forming new highs.


The SMI (Swiss Market Index) is still wedging higher and is neutral at best.
I would watch a break of 6400 very closely. A fast move down to 6000 is definetly possible.

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