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Weekly market brief: 17 - 21 January 2022


Index

Current price

Forecast

S1

R1

S2

R2

​FTSE100

7.543

Bearish

7.520

7.570

7.405

7.600

FTSEMIB

27.544

Bearish

27.406

27.975

26.750

28.315

DAX 40

15.883

Bearish

15.736

15.980

15.040

16.290

S&P 500

4.662

Consolidation

4.600

4.720

4.535

4.808

NASDAQ 100

15.612

Cons./ Bullish

15.530

16.450

15.180

16.770

DOW JONES

35.912

Cons./ Bearish

35.650

36.565

35.350

36.815

S: Support R: Resistance

FTSE 100 (#UKX)

The FTSE 100 ended the week up + 0.79%

For the week we remain in favour of an initial retracement to 7,490, to then continue to 7,405


Indicators

This week saw the FTSE100 perform better than other European and American indices. The 9MA still remains strong support of the index's bullish upside.


MACD continues its slow weakening and we believe it may soon reverse to the downside.

RSI, which after breaking the bullish trendline has carried out a "back-test", we believe is signalling an imminent bearish pressure.


To better understand the price action of the British index in recent weeks, it is necessary to carry out a "cross-asset" analysis by going to see how the strong performance of energy and financial stocks has in fact allowed an outperformance of the UKX compared to its peers: the influence of these two sectors was greater than the downward pressure not only of the general sentiment on the markets but also of a notable appreciation of the GBP / USD exchange rate (which has an inverse relationship with the FTSE100).


The current swing at the top of the uptrend channel, combined with an over-extension of the energy and financial sectors of which we expect a retracement, makes us shift the risk/return on the FTSE100 in favour of short-term falls.


Support for 7,520

Resistance at 7,570


FTSEMIB (FTSEMIB)

The FTSEMIB had a week down by -0.88%

For the week we remain in favour of bearish continuation till 27,250


Indicators

The week saw the formation of a lower high that could support the theory of further bearish pressure on the Italian index.

The closing below the 9MA is also a further confirmation of a change in trend in the short term.


MACD, is about to cross to the downside along with a RSI that looks close to falling below the 50 line.


Despite a medium to long-term bullish view, we believe that the retracement of the FTSEMIB is not yet concluded and we expect further retracements in the short term.


Support at 27.406

Resistance at 27,975


DAX (#DAX)

IThe DAX ended the week down -0.83%

For the coming week we remain in favour of an initial retracement at 15,736 and then continue at least till 15,500.


Indicators

The week just ended seems to want to confirm a bearish formation: after testing the strong support at 15,736, the index recovered slightly and then reversed to the downside. This type of swing tends to generate further bearish pressure, stronger than the initial one.


MACD seems close to a bearish cross and RSI, after breaking the bullish trendline and carrying out a back-test, is very close to a break of the 50 line.


Support for 15,736

Resistance at 15,980