Index | Current price | Forecast | S1 | R1 | S2 | R2 |
FTSE100 | 7.384 | Bearish | 7.330 | 7.405 | 7.220 | 7.490 |
FTSEMIB | 27.347 | Cons./ Bearish | 26.750 | 27.406 | 25.820 | 27.975 |
DAX 40 | 15.885 | Consolidation | 15.736 | 15.980 | 15.040 | 15.980 |
S&P 500 | 4.766 | Bearish | 4.720 | 4.808 | 4.600 | 4.900 |
NASDAQ 100 | 16.320 | Cons./ Bearish | 15.700 | 16.450 | 15.180 | 16.770 |
DOW JONES | 35.365 | Bearish | 36.00 | 36.565 | 35.350 | 36.815 |
S: Support R: Resistance
FTSE 100 (#UKX)
The FTSE 100 ended the week up + 0.39%
For the week ahead we expect a retracement to at least 7,300
Indicators
During the last days of the week, we believe the FTSE 100 has started to form a consolidation that lead to a slight retracement.
The MACD, well above 0 is now showing signs of weakening along with a RSI very close to the overbought zone.
We can also see how the RSI could soon give indications of stronger fluctuations in the short term: for this indicator, in fact, we see a strong resistance at 62 and a trendline. That if broken, it could anticipate bearish swings.
Although the primary trend remains bullish, we believe that the current risk/return of the index pushes more towards bearish swings.
The first strong support area coincides with the crossing of the 50MA between 7,300 and 7,250.
Support at 7,330
Resistance at 7,405
FTSEMIB (#FTSEMIB)
The FTSEMIB had a week up + 1.71%
For the week we expect a possible test at 27,000
Indicators
After the strong bullish push of the last few weeks, the Italian index is now consolidating at a strong resistance level.
In our view, we may now see a slight retracement to at least the 50MA. In fact, if on one hand, the MACD has just crossed the 0 line indicating a positive change in momentum it more the RSI to suggest bearish swings in the short term.
The RSI is now at 62, a strong resistance that has repeatedly repelled the index from bullish continuations.
To monitor carefully the levels of 27,250 for bearish fluctuations and 27,250 for a bull continuation.
Support for 26,750
Resistance at 27.406
DAX (#DAX)
The DAX ended the week up + 1.35%
For the week ahead, we expect a consolidation between 15,736 and 15,980
Indicators
The German index has now entered what we believe to be a consolidation phase very similar to the period of August 2021.
Despite a MACD in recovery, there are two indicators that make us think of a consolidation and subsequent decline in the short term: the RSI is now approaching the area of 60, a strong resistance that has repeatedly stopped the index from continuing bullish.
In addition, we can see that the last 8 strong bullish candles have recorded decreasing volumes.
Despite an uptrend, we believe that the current risk / return of the DAX pushes more towards bearish swings.
Support for 15,736
Resistance at 15,980
S&P500 (#SPX)
The DAX ended the week up + 1.35%
For the week ahead, we expect a consolidation between 15,736 and 15,980
Indicators
The German index has now entered what we believe to be a consolidation phase very similar to the period of August 2021.
Despite a MACD in recovery, there are two indicators that make us think of a consolidation and subsequent decline in the short term: the RSI is now approaching the area of 60, a strong resistance that has repeatedly stopped the index from continuing bullish.
In addition, we can see that the last 8 strong bullish candles have recorded decreasing volumes.
Despite an uptrend, we believe that the current risk / return of the DAX pushes more towards bearish swings.
Support for 15,736
Resistance at 15,980
NASDAQ 100 (#NDX)
The NASDAQ ended the week down -0.62%
For the week ahead, we expect a possible test of the 16,100
Indicators
The technology index continues to fluctuate on a broad parallel channel between 15,700 and 16,450, and we do not believe it is ready for a break to the upside for the moment.
MACD, despite exceeding 0, we can see a decreasing trend since November
Very similar situation on the RSI, also in strong divergence with the levels of early November 2021.
Given the previous swings, we believe the risk-return is more in favor of short-term bearish movements.
Support at 15,700
Resistance at 16,450
DOW JONES (#DJI)
The DOW JONES had a week up + 0.78%
For the week ahead, we expect a retracement of up to 36,000
Indicators
After a strong push in the last few weeks, we believe that the DOW is now forming a reversal pattern that could lead to retracements at least to the resistance area.
In fact, despite having reached new highs, these levels were not supported by MACD and RSI, which instead appear to be in strong divergence with the price.
Despite an uptrend, we believe that the index may retrace before eventually continuing to rise.
Support to 36,000
Resistance 36,565
OTB Global Investments
2 January 2022
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