Tuesday, June 14, 2011
Market Analysis - DAX 30 and EUROSTOXX 50
The German DAX 30 broke above its downtrend line of the consolidation pattern this morning. The recently mentioned gap between 7183 and 7194 is already closed and I think 7300 is on the horizon. Maybe even 7500 points are possible over the next few weeks. My opinion is that the up gap should hold today and even over the next few days. A break back underneath the trendline would be bearish.
The EUROSTOXX 50 also started some sort of relief rally this morning but not as impulsive as the DAX 30 did. It has already broken the lower trendline but I think there is also a second way how you can draw a trendline. In the chart below you can see that this trendline is now around 2800 so we will see. In the short-/medium term I am positive but take a close look at today's gaps in both indices.
Monday, June 13, 2011
Market Analysis - DAX 30, NIKKEI 225 and IBEX 35
Today I will take a quick look at the XETRA DAX 30, NIKKEI 225 and IBEX 35.
To me it seems that the German DAX 30 is still consolidating before moving back higher. My upside target is around the highs of February (7400). There it will be critical to take out the recent highs around 7600. That will be quite difficult because my opinion is that we are already near a top. But now back to the shorter term picture. There is still a gap open between 7184 and 7193 which I expect to get closed. Right there is also the declining trendline. For sure the DAX 30 could test before a gap close the 50 week moving average around 6850 but the declining line from the February highs to the March/April high held so far as support. If you are short the DAX 30 be aware that above 7200 a fast short-squeeze could occur up to 7300.
The NIKKEI 225 has build a more sideways than downward channel since mid 2009. I am not expecting a near term breakout of this channel. In the short term the recent lows around 9350 must hold as support otherwise a retest of the Fukushima lows is in the cards. On the other hand a break above 9750 will send the index to 10000 and afterwards the upper trendline will get in focus.
The Spanish IBEX 35 is an underperformer compared to the German DAX 30. The index is forming a triangle since 2010 and on a logarithmic scale the IBEX 35 already broke to the downside. Shorter term I want to emphasize the 9800 level. It was resistance many times in 2008 and 2009 and should act as support. Since mid 2010 the 11000 level acted as resistance. I will watch a break under or above these levels for a trading opportunity.
Please feel free to leave any comments or send me an email.
To me it seems that the German DAX 30 is still consolidating before moving back higher. My upside target is around the highs of February (7400). There it will be critical to take out the recent highs around 7600. That will be quite difficult because my opinion is that we are already near a top. But now back to the shorter term picture. There is still a gap open between 7184 and 7193 which I expect to get closed. Right there is also the declining trendline. For sure the DAX 30 could test before a gap close the 50 week moving average around 6850 but the declining line from the February highs to the March/April high held so far as support. If you are short the DAX 30 be aware that above 7200 a fast short-squeeze could occur up to 7300.
The NIKKEI 225 has build a more sideways than downward channel since mid 2009. I am not expecting a near term breakout of this channel. In the short term the recent lows around 9350 must hold as support otherwise a retest of the Fukushima lows is in the cards. On the other hand a break above 9750 will send the index to 10000 and afterwards the upper trendline will get in focus.
The Spanish IBEX 35 is an underperformer compared to the German DAX 30. The index is forming a triangle since 2010 and on a logarithmic scale the IBEX 35 already broke to the downside. Shorter term I want to emphasize the 9800 level. It was resistance many times in 2008 and 2009 and should act as support. Since mid 2010 the 11000 level acted as resistance. I will watch a break under or above these levels for a trading opportunity.
Please feel free to leave any comments or send me an email.
Sunday, June 12, 2011
Market Analysis - CAC 40, S&P 500, SMI and ATX
Today I will take a look at the CAC 40, S&P 500, SMI and ATX.
The chart of the CAC 40 looks like the EUROSTOXX 50 chart. It is basically in a sideways market since the end of 2009. From last year's summer until now it formed a nice uptrend which lower trendline is at 3800. There is a good chance that this trendline holds as support once again otherwise a test of 3700 is very likely.
Below 3700 the situation would get more bearish and the lows of 2010 could be retested.
The S&P 500 on the other side looks in the longer term picture much healthier and is still above its uptrend. Nevertheless the shorter term trend is clearly down and test of the March 2011 lows, the 200 day moving average and the trendline, all around 1250 should happen next week. I am expecting a rebound back above 1300 in the next four weeks or so, but longer term this could turn out as a big top formation. If the S&P 500 breaks below 1250 the next support is around 1220 to 1225. In my opinion the mentioned scenario is in the cards until the S&P 500 breaks below 1200.
The SMI is like many other European indices in a sideways market since the end of 2009. A very critical level for the SMI is the 6000 level. It acted as support twice and a break below would indicate a move back down to 5200.
The ATX looks a little bit better than the SMI. In December 2010 the ATX broke above 2700 and 2800. This area acted as resistance in 2009 and 2010 and is now support for the index. But be cautious because the bounces off that 2700 level are getting weaker and weaker. A break below 2700 would send the ATX back down to 2400.
The chart of the CAC 40 looks like the EUROSTOXX 50 chart. It is basically in a sideways market since the end of 2009. From last year's summer until now it formed a nice uptrend which lower trendline is at 3800. There is a good chance that this trendline holds as support once again otherwise a test of 3700 is very likely.
Below 3700 the situation would get more bearish and the lows of 2010 could be retested.
The S&P 500 on the other side looks in the longer term picture much healthier and is still above its uptrend. Nevertheless the shorter term trend is clearly down and test of the March 2011 lows, the 200 day moving average and the trendline, all around 1250 should happen next week. I am expecting a rebound back above 1300 in the next four weeks or so, but longer term this could turn out as a big top formation. If the S&P 500 breaks below 1250 the next support is around 1220 to 1225. In my opinion the mentioned scenario is in the cards until the S&P 500 breaks below 1200.
The SMI is like many other European indices in a sideways market since the end of 2009. A very critical level for the SMI is the 6000 level. It acted as support twice and a break below would indicate a move back down to 5200.
The ATX looks a little bit better than the SMI. In December 2010 the ATX broke above 2700 and 2800. This area acted as resistance in 2009 and 2010 and is now support for the index. But be cautious because the bounces off that 2700 level are getting weaker and weaker. A break below 2700 would send the ATX back down to 2400.
Saturday, June 11, 2011
Market Analysis - DAX 30, EUROSTOXX 50 and FTSE 100
Market analysis for the upcoming week!
First let's take a look at the XETRA DAX on a weekly chart. Here you can see despite the recent decline the DAX is still in an uptrend. Both the 50 week EMA and the 50 week SMA are around 6800 and as I pointed out in the chart below these moving averages usually hold as support or resistance. Furthermore the trendline of the upward channel is just around 6800.
On a daily chart the situation looks similar. The 200 day moving averages are around 6900 and both the Stochastic and the RSI are showing some positive divergences. For next week I am expecting a last shakeout to the downside before moving back up to at least 7400. For now I think an ending diagonal is in the cards which maybe pushes the DAX up to 7800. The last move up should overshoot to the upside above the upper trendline. If we are testing 6800 to 6900 during the first two days next week I am still expecting a weekly close above 7040. If we are closing next week below 6800 I am rethinking my bullish scenario.
The next chart shows the EUROSTOXX 50 which broke out of its channel to the downside. As I mentioned in one of my last few posts I think the EUROSTOXX is testing the 2300 area during the next few months but for now the index is still in a big sideways correction. In the short term the EUROSTOXX 50 is oversold and should retest 2800. A break below 2700 on a closing basis would indicate a move back down to 2600.
The FTSE 100 is still above its trendline and fighting with its 200 day moving averages. If the FTSE cannot hold this trendline a move back down to 5600 is very realistic. A break above 6100 would give us an upside target around 6400 and a break below 5520 will probably send the FTSE 100 back down to 5000. I am not expecting a breakout of this range between now and the end of August but be aware of these levels.
First let's take a look at the XETRA DAX on a weekly chart. Here you can see despite the recent decline the DAX is still in an uptrend. Both the 50 week EMA and the 50 week SMA are around 6800 and as I pointed out in the chart below these moving averages usually hold as support or resistance. Furthermore the trendline of the upward channel is just around 6800.
On a daily chart the situation looks similar. The 200 day moving averages are around 6900 and both the Stochastic and the RSI are showing some positive divergences. For next week I am expecting a last shakeout to the downside before moving back up to at least 7400. For now I think an ending diagonal is in the cards which maybe pushes the DAX up to 7800. The last move up should overshoot to the upside above the upper trendline. If we are testing 6800 to 6900 during the first two days next week I am still expecting a weekly close above 7040. If we are closing next week below 6800 I am rethinking my bullish scenario.
The next chart shows the EUROSTOXX 50 which broke out of its channel to the downside. As I mentioned in one of my last few posts I think the EUROSTOXX is testing the 2300 area during the next few months but for now the index is still in a big sideways correction. In the short term the EUROSTOXX 50 is oversold and should retest 2800. A break below 2700 on a closing basis would indicate a move back down to 2600.
The FTSE 100 is still above its trendline and fighting with its 200 day moving averages. If the FTSE cannot hold this trendline a move back down to 5600 is very realistic. A break above 6100 would give us an upside target around 6400 and a break below 5520 will probably send the FTSE 100 back down to 5000. I am not expecting a breakout of this range between now and the end of August but be aware of these levels.
Wednesday, March 9, 2011
Market Analysis - EUROSTOXX 50 and DAX 30
Welcome back to my blog. During the last month my schedule was really tight so I was not posting.
The XETRA DAX broke the upward trend and is now forming a bullish continuation pattern. Nevertheless the index is due for a further pullback and so I would watch a break of this flag in every direction. A break to the downside could lead the DAX down to 6850 a break to the upside would indicate prices around the February highs.
The EUROSTOXX 50 broke above its trading channel and also above the highs from 2010. Obviously this level was not sustainable and so it broke back down into the former trading channel. Such false breakouts usually indicate a much stronger move. So watch out. Support should be around 2900 and below that 2750.
The XETRA DAX broke the upward trend and is now forming a bullish continuation pattern. Nevertheless the index is due for a further pullback and so I would watch a break of this flag in every direction. A break to the downside could lead the DAX down to 6850 a break to the upside would indicate prices around the February highs.
The EUROSTOXX 50 broke above its trading channel and also above the highs from 2010. Obviously this level was not sustainable and so it broke back down into the former trading channel. Such false breakouts usually indicate a much stronger move. So watch out. Support should be around 2900 and below that 2750.
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