Category: Stock Markets

Analysis of major stock markets around the world.

Posted on

Nasdaq hints at recovery

Dow Jones Industrial Average is testing resistance at 11700. Breakout would warn of a primary advance, but the market is prone to false signals because of excessive volatility and it would be prudent to wait for confirmation. Respect of 11700, or a false break above 11700, would re-visit support at 10600.

Dow Jones Industrial Average

* Target calculation: 11000 – ( 12000 – 11000 ) = 10000

The S&P 500 is similarly testing resistance at 1230 on the weekly chart. Breakout would signal an advance to 1350, while respect would indicate another test of 1100. Breakout above the declining trendline on 13-week Twiggs Money Flow suggests nothing more than a secondary reaction (bear market rally). See the monthly chart.

S&P 500 Index

* Target calculation: 1100 – ( 1250 – 1100 ) = 950

The Nasdaq 100 index, however, broke through 2350 and is headed for its July high. Bullish divergence on 13-week Twiggs Money Flow indicates reversal to an up-trend. Breakout above 2440 would confirm, offering a target of 2800*.

Nasdaq 100 Index

* Target calculation: 2400 + ( 2400 – 2000 ) = 2800

Posted on

Has The Stock Market “Thrusted” Off A Bottom? | The Big Picture

We decided to take a further look at the highlighted statement above to see if we have hit a ‘significant bottom’ in the stock market after 3 consecutive daily rallies of 1.75% or more last week.

……A lot of people have been talking about this pattern.  The implication is this represents a thrust off a low and the start of a significant move higher.  History shows this has only been the case when this pattern results in a breakout of the previous range (see 1984).  When this thrust results in a move back into a defined range (see 2002), it has little meaning.  When the market only barely broke out (see 1974), the market churned sideways for months before moving higher.

Has the market’s trend changed?  For now, the answer appears to be “no.”  Until a breakout is established, we would not get that excited about the three consecutive daily rallies of 1.75% or more.

Source:
Bianco Research, LLC.
October 10, 2011

via Has The Stock Market “Thrusted” Off A Bottom? | The Big Picture.

Posted on

ASX 200 fails to respond to Dow surge

Dow Jones Industrial Average broke its declining trendline Monday, surging strongly, but light volume indicates hesitancy on the part of buyers.

Dow Jones Industrial Average

* Target calculation: 11000 – ( 12000 – 11000 ) = 10000

Asian stocks reacted with enthusiasm but Shanghai, after gapping up at the open, fell sharply, giving up most of its gains. The ASX 200 response was muted, with a narrow range and low volume indicating hesitancy from buyers. Reversal below Monday’s low of 4150 would signal another test of 3850. Failure of support would offer a target of 3600*.

ASX 200 Index

* Target calculation: 3900 – ( 4200 – 3900 ) = 3600

Posted on

Stocks’ Volatility Is Worrisome Sign – WSJ.com

Many investors are entering this week with fresh hopes the worst is over, after last week’s sudden stock-market rebound. But history suggests that in times of market turmoil, there is a risk that big, sudden gains like last week’s will prove temporary respites before stocks fall again. Head-snapping volatility, both steep drops and sharp gains, most often comes in times of market trouble. It suggests that, despite the bounce last week, the market isn’t healthy, says economic historian Richard Sylla of New York University’s Stern School of Business. “Financial markets become more volatile in periods of stress. People don’t know which way things are going to go, so you get these big up and down movements as people pile in and get out,” he says.

via Stocks’ Volatility Is Worrisome Sign – WSJ.com.

Posted on

FTSE 100 buyers scarce

The FTSE 100 index encountered resistance at 5400. Low volume indicates that buyers were scarce and another test of support at 5000 is likely. We are in a primary down-trend and failure of support would signal a decline to 4400*.

FTSE 100 Index

* Target calculation: 5000 – ( 5600 – 5000 ) = 4400

The DAX index is starting to rally on the weekly chart, with 13-week Twiggs Money Flow indicating medium-term buying pressure. Expect a test of 6000, but again we are in a primary down-trend and another test of 5000 is likely. Failure of support would signal a decline to 4000*.

German DAX Index

* Target calculation: 5000 – ( 6000 – 5000 ) = 4000

Posted on

TSX 60 finds support

Canada’s TSX 60 index found support between 620 and 650. A rally to test resistance at 730 is indicated, but the primary trend is down and 13-week Twiggs Money Flow continues to signal selling pressure. Reversal below 650 would warn of a decline to 580*.

TSX 60 Index

* Target calculation: 650 – ( 720 – 650 ) = 580

Posted on

NASDAQ bullish divergence

NASDAQ 100 index respected primary support at 2040 before rallying strongly on the weekly chart. Bullish divergence on 13-week Twiggs Money Flow indicates buying pressure. Breakout above 2340 would complete a double bottom. Reversal below 2000 is less likely, but would warn of a decline to 1700*. A word of caution: we are in a highly volatile market — do not act on signals without confirmation from other indexes.

NASDAQ 100 Index

* Target calculation: 2000 – ( 2300 – 2000 ) = 1700

Posted on

Fedex reflects slowing economy

A 30 percent decline on the Fedex weekly chart reflects the slowing rate of economic activity. Recovery above resistance at $70 suggests another bear market rally, but the primary trend is down. Declining 13-week Twiggs Money Flow, below zero, indicates long-term selling pressure.

Fedex

* Target calculation: 70 – (80 – 70 ) = 60

The weekly chart of Deutsche Post AG indicates similar weakness in Europe. We may see a rally test resistance at €11.00 but the primary trend is down and reversal below €9.00 would offer a target of €7.00*.

Deutsche Post DHL

* Target calculation: 9 – ( 11 – 9 ) = 7

Posted on

One down five to go

I say this rather flippantly as we are in the middle of a bear market, and I do not believe we are ready, but a reader asked what it would take to signal a bull market. My answer: three decent blue candles on the weekly chart followed by a correction of at least two red candles that respects the preceding low. The weekly chart of the S&P 500 index displays a blue candle with a long tail, signaling buying support. That would qualify as candle #1.

S&P 500 Index

* Target calculation: 1100 – ( 1250 – 1100 ) = 950

There is no supporting divergence on 13-week Twiggs Money Flow to signal a change in the underlying selling pressure. Reversal to an up-trend is unlikely but would take a rally of at least 3 blue candles to break resistance at 1250 followed by a correction that finishes above 1100 — and re-crosses 1250. What is more likely is a failed attempt or false break at 1250 followed by penetration of support at 1100, signaling a decline to 1000/950*.

Powered by WordPress / WordPress Maintenance Service By Website Helper