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The weekly market brief

๐Ÿ’ก21 - 25 December 2020

๐Ÿ“ˆ FTSE 100: 6,502.11 (- 0.74%)

๐Ÿ“ˆ DAX: 13,587.23 (-0.84%)

๐Ÿ“ˆ S&P 500: 3,703.06 (-0.49%)

๐Ÿ“ˆ Nasdaq 100: 12,711.01 ( -0.37%)

๐Ÿ“ˆ Dow Jones: 30,199.87 ( - 0.37%)

The percentage increases are on a weekly basis


FTSE 100 (#UKX)


Despite a shorter week, the #UKX had quite a good level of volatility. On Monday 21st, the index dropped till 6,315: good level of resistance for almost the whole month of November and gradually re-entered in the levels we highlighted last week.


The doji candle that closed the week perfectly represents the indecision of market: a fear of new Covid infections together with a Brexit deal that did not really cheer up the British Pound.


The week ahead is still a short one, therefore we expect the FTSE to keep floating within current levels: seen the momentum of the last three trading days, the Index may overcome the 9MA and reach the first intermediate resistance at 6,550. On strong volumes could even reach the upper end of the channel at 6,600

At present, the FTSE is indeed stuck between a possible reversal and 50MA that holds strongly the support levels.


From a technical perspective, the MACD is still pointing to the downside together with a RSI that left the overbought territory and it is now consolidating at 60.

The 50 MA holds strongly and makes the 6,315 level a very good level of support for the near future.


As of today, we confirm resistance at 6,606 and support at 6,462 and we do expect the FTSE to stay in this levels for the week ahead.


DAX (#DAX)


The German #DAX had a rough start of the week with a bearish fall till almost 13,000.

After Monday, the Index strongly recovered and re-entered the level highlighted last week with support at 13,452.


The hammer candle reported on Monday, together with the following two strong bullish candles leading us to think that the #DAX may stay in the current levels for the week ahead and perhaps continue the move to the upside.

From a technical perspective, the MACD is in fact sloping up together with the RSI that is pointing to the upside.


For the week ahead, we confirm support at 13,452 and resistance at 13,784.


S&P 500 (#SPX)


The #SPX left the upward channel we have been pointing out for the last weeks and entered in what we believe being a consolidation move.


On Monday, the #SPX touched and bounce back from the support level of 3,637 and moved sideways for the rest of week.


From a technical perspective, the 9MA keep holding the way: it is still too early to understand if the #SPX is forming an ascending triangle that will soon break the 3,708 resistance and continue to the upside, or it will fall exhausted testing support levels.

The MACD is still pointing to the downside and the RSI did not really move much from last week.


Unless, a strong move to the upside that will hold the Index above the current resistance level, we confirm for the week ahead support at 3,637 and resistance at 3,708.

If resistance will be broken, the next levels to consider will be support at 3,708 and resistance at 3,806.



Nasdaq 100 (#NDX)


The Tech index this week almost closed unchanged: however, the sharp move of Monday brought the index to test the lower end of the channel and position itself on the lower half of it.


Despite a 9MA that keeps support the Index, we do believe the #NDX is losing its strength: on the MACD side, the 12 MA crossed the 26MA giving us the impression that the momentum might reverse soon. The RSI is still showing strong divergence with the price.


For the week ahead, since the support level has not been broken yet we confirm the levels of support at 12,650 and resistance at 13,014.


Dow Jones (#DJI)


The Dow this week, as majority of the index we cover, touched the support level to then bouncing back and re-enter within the perimeters of the 9MA.

From a technical perspective, the MACD is still showing a downward trend: we read the current MACD as indicator that the Index doesnโ€™t have anymore the strength for strong moves to the upside. This is why the moves to the downside have been much stronger than the ones to the upside (โ€œstairs up but elevator downโ€).

In addition, the RSI is still showing very strong divergence with the price.


For the near future, we believe the #DJI is in consolidation: it is from the 4 December that the Index keep brushing the resistance level at 30,345*.

We confirm support at 29,746 and resistance at 30,345: for the week ahead, we believe the #DJI may re-test the resistance before considering sharp moves in either directions.


*resistance level adjusted from 30,335 to 30,345


OTB Global Investments

London, 27 December 2020

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