Stock Markets Archives - Page 111 of 170

September 25, 2013

Asia recovery helps ASX 200

China’s Shanghai Composite Index ran into resistance at 2250 and is likely to retrace to support at 2100. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure. Respect of 2100 would be bullish, while recovery above 2250 would penetrate the descending trendline, suggesting that the primary down-trend is reversing. A primary up-trend would signal increased demand for resources and give a significant boost to the ASX. Failure of 2100 is unlikely, but would indicate a test of primary support at 1950.

Shanghai Composite Index

Japan’s Nikkei 225 is testing resistance at 15000. Breakout would signal an advance to 17500*. Earlier bearish divergence on 13-week Twiggs Money Flow, however, warns of a reversal. Penetration of the rising trendline would also suggest the primary up-trend is losing momentum. Failure of support at 13200 remains unlikely, but would signal a reversal.

Nikkei 225

* Target calculation: 15000 + ( 15000 – 12500 ) = 17500

India’s Sensex retreated below resistance at 20500. Tall shadows and long tails on the weekly chart indicate excessive volatility. Reversal below last week’s low at 19500 would warn of another down-swing. Breach of the rising trendline would strengthen the reversal warning. A 13-week Twiggs Money Flow trough above zero, however, would suggest continuation of the primary up-trend.

Sensex

* Target calculation: 18500 – ( 20500 – 18500 ) = 16500

ASX 200 recovery above the May high of 5250 indicates a primary advance. Follow-through above 5300 would confirm. Rising 21-day Twiggs Money Flow suggests medium-term buying pressure. Long-term target for an advance would be 5850*.

ASX 200

* Target calculation: 5250 + ( 5250 – 4650 ) = 5850

September 24, 2013

Europe: Bullish except for FTSE

European markets continue to display healthy primary up-trends with the exception of the FTSE 100 which warns of selling pressure.

Germany’s DAX broke through medium-term resistance at 8500, offering a medium-term target of 9000* and a long-term target of 9500*. Reversal below 8000 is unlikely, but would warn of another test of primary support at 7500.

DAX

* Target calculation: 8500 + ( 8500 – 8000 ) = 9000 ; 8500 + ( 8500 – 7500 ) = 9500

France’s CAC-40 is testing resistance at its 2011 high of 4200. Retracement to short-term support at 4100 is likely. Respect of support would be a bullish sign, while breakout above 4200 would offer an immediate target of 4300* and a long-term target of 4500*. Reversal below 3900 is unlikely but would warn of a bull trap.

CAC-40

* Target calculation: 4100 + ( 4100 – 3900 ) = 4300 ; 4050 + ( 4050 – 3600 ) = 4500

Spain’s Madrid General Index followed through above 900, but is now retracing to test the new support level. Respect would confirm a long-term advance to 1050* (960* in the medium-term). Rising 13-week Twiggs Money Flow indicates buying pressure. Reversal below 840 is unlikely, but would warn of a bull trap.

Madrid General Index

* Target calculation: 900 + ( 900 – 750 ) = 1050 ; 900 + ( 900 – 840 ) = 960

Italy’s MIB Index is testing resistance at 18000. Retracement to support at 17500 is likely, but respect would be bullish. Breakout above 18000 would offer an immediate target of 18500 and a long-term target of 20000*. Reversal below 16500 is most unlikely, but would warn of a bull trap.

MIB Index

* Target calculation: 17500 + ( 17500 – 15000 ) = 20000

Bearish divergence on the FTSE 100 (13-week Twiggs Money Flow) warns of strong selling pressure. Reversal below 6400 would warn of a primary down-trend, confirmed if the rising trendline is broken. Reversal of TMF below zero would strengthen the signal. Breakout above 6750 is unlikely, but would signal a medium-term advance to the 1999 high of 7000.

FTSE 100

September 24, 2013

Bellwether Fedex suggests improving economy

Bellwether transport stock Fedex displays a healthy primary up-trend on the monthly chart, suggesting that economic activity is improving. Bearish divergence on 13-week Twiggs Money Flow warns of selling pressure at the 2007 high of $120; reversal below zero would indicate a reversal, while a trough above the zero line would signal a primary up-trend. Breakout above $120 would offer a target of $130*.

Fedex

* Target calculation: 120 + ( 120 – 110 ) = 130

September 23, 2013

TSX meets resistance

Canada’s TSX Composite index also displays tall shadows on last week’s candle, indicating short-term selling pressure. Follow-through below 12700 would suggest another test of primary support at 12400. Reversal of 13-week Twiggs Money Flow below zero would warn of long-term selling pressure, while a trough above the zero line would again suggest a primary up-trend. Breakout above 12900 is unlikely at present, but would confirm.

TSX Composite

* Target calculation: 12900 + ( 12900 – 11900 ) = 13900

September 23, 2013

Dow warns of reversal but VIX refutes

Dow Jones Industrial Average tall shadow (or wick) on last week’s candle warns of short-term selling pressure — echoing the long-term bearish divergence on 13-week Twiggs Money Flow. Reversal below 14800 would confirm a primary down-trend. Breakout above 15660 is unlikely, but would signal a fresh advance.

Dow Jones Industrial Average

However, VIX below 15 continues to suggest a bull market.

VIX Index

I have more faith in the calculation of the S&P 500 index — which displays a milder bearish divergence. While reversal below 1630 would signal a reversal, it would not penetrate the long-term rising trendline; only breach of 1530 would be cause for serious alarm. Respect of support at 1630, on the other hand, would be bullish, suggesting an advance to 1850.

S&P 500

* Target calculation: 1700 + ( 1700 – 1550 ) = 1850

September 16, 2013

Asian markets and ASX cautious

Japan’s Nikkei 225 Index broke its descending trendline, indicating the correction is over. Breakout above 15000 would signal a primary advance to 18000*. Recovery of 13-week Twiggs Money Flow above 30% would support this. Reversal below 13000 is now unlikely.

Nikkei 225 Index

China’s Shanghai Composite breached its descending trendline at 2200, indicating the down-trend is over. A long wick (or shadow) on last week’s candle, however, suggests resistance — and reversal below 2150 and the rising trendline would warn of a bull trap. But rising 13-week Twiggs Money Flow continues to signal medium-term buying pressure. Follow-through above 2350 is likely, and would indicate a test of 2450.

Shanghai Composite Index

India’s Sensex also displays a long wick on last week’s candle. Expect strong resistance at 20500. Respect would indicate another test of primary support at 18000. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure, but long-term direction is unclear.

BSE Sensex Index

The ASX 200 is cautiously testing long-term resistance at 5250. Europe is bullish and Asian markets are rising, but the Dow and S&P 500 remain mildly bearish. Respect of resistance at 5250, indicated by reversal below 5150 and the rising trendline, would present another bearish divergence on 13-week Twiggs Money Flow, indicating long-term selling pressure. Breakout above 5250, however, would signal another primary advance, with a long-term target of 5750*.

ASX 200 Index

* Target calculation: 5250 + ( 5250 – 4750 ) = 5750

September 16, 2013

TSX finds stubborn resistance

Canada’s TSX Composite retreated from stubborn resistance at 12900 on the weekly chart. 13-Week Twiggs Money Flow turned down, indicating medium-term selling pressure. Another trough above zero, however, would suggest a primary up-trend. Breakout above 12900 would offer a long-term target of 14000*, but breach of support at 12400 remains as likely — and would signal a decline to 11750.

TSX Composite Index

* Target calculation: 12900 + ( 12900 – 11800 ) = 14000

September 16, 2013

Europe: Unleash the bulls

Spain’s Madrid General Index broke resistance at 900, indicating a long-term advance to 1050* (960* in the medium-term). Rising 13-week Twiggs Money Flow indicates buying pressure. Reversal below 840 is unlikely, but would warn of a bull trap.

* Target calculation: 900 + ( 900 – 750 ) = 1050; 900 + ( 900 – 840 ) = 960

Germany’s DAX is similarly testing resistance at 8500. Breakout would offer a medium-term target of 9000* and a long-term target of 9500*. Recovery of 13-week Twiggs Momentum above 10% would also signal continuation of the primary up-trend.
DAX Index

* Target calculation: 8500 + ( 8500 – 8000 ) = 9000; 8500 + ( 8500 – 7500 ) = 9500

France’s CAC-40 is testing resistance at 4120. Breakout would offer a medium-term target of 4300*, but follow-through above its 2011 high at 4200 would also confirm a long-term advance to 4500*. Reversal below 3900 is unlikely but would warn of a bull trap.
CAC-40 Index

* Target calculation: 4100 + ( 4100 – 3900 ) = 4300; 4050 + ( 4050 – 3600 ) = 4500

Italy’s MIB Index is also testing resistance, at 17700. Money Flow indicates strong buying pressure and breakout above 18000 would signal a long-term advance to 20000*. Reversal below 16500 is most unlikely, but would again warn of a bull trap.

* Target calculation: 17500 + ( 17500 – 15000 ) = 20000

The FTSE 100 is far more subdued, encountering resistance at 6600 after an end to the recent correction. Follow-through above 6700 would signal a medium-term advance to the 1999 high of 7000*, but reversal below 6500 would warn of another test of medium-term support at 6400. Failure of 6400, while unlikely, would test primary support at 6000.
FTSE 100 Index

September 15, 2013

Dow, S&P 500 selling pressure but VIX bullish

Dow Jones Industrial Average put in a strong blue candle last week, but 13-week Twiggs Money Flow bearish divergence continues to warn of a reversal. Exercise caution until there is a breakout above the August high of 37% on TMF following an index breakout above 15660. Failure of primary support at 14500 would confirm a reversal, but continuation of the up-trend now seems as likely.

Dow Jones Industrial Average

The S&P 500 displays a similar bearish divergence on the daily chart, indicating selling pressure. 21-Day Twiggs Money Flow is now rising and follow-through above the July high at 23% would negate the warning. As would breakout above 1710 on the index chart, signaling a long-term advance to 1900*. Respect of resistance remains as likely, however, and reversal below 1670 would test the then primary support level at 1630.

S&P 500 Index

* Target calculation: 1710 + ( 1710 – 1630 ) = 1890

Despite the bearish divergences, VIX below 20 continues to suggest a bull market.
VIX Index

September 12, 2013

US & China lift ASX

The S&P 500 rallied strongly this week despite a weak bearish divergence on 13-week Twiggs Money Flow warning of selling pressure. Recovery above 1700 would indicate another advance, while a new August high on Twiggs Money Flow would further strengthen the signal, offering a target of 1850*. Reversal below 1630 is unlikely, but would re-test primary support at 1560.

S&P 500 Index

* Target calculation: 1700 + ( 1700 – 1550 ) = 1850

Dow Jones Industrial Average displayed a stronger bearish divergence on 13-week Twiggs Money Flow, increasing the likelihood of reversal below 14800. But positive sentiment is growing and recovery above 15650 now seems as likely.
S&P 500 Index

China’s Shanghai Composite penetrated resistance at 2200 and the descending trendline, suggesting that the down-trend is ending. Reversal below the rising trendline would warn of another correction to test primary support at 1950, but breach of support is now less likely. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure; a trough above zero would strengthen the signal.

Shanghai Composite Index

The ASX 200 is testing resistance at 5250, buoyed by positive sentiment in China and the US. Breakout would suggest a primary advance, but a lower peak on 13-week Twiggs Money Flow would continue to warn of selling pressure. Reversal below 5150 remains as likely, and would test medium-term support at 4900/5000.

ASX 200 Index

* Target calculation: 5250 + ( 5250 – 4750 ) = 5750