S&P 500 – Pull-backed target/support reached at 2190/78 support zone (Click to enlarge charts) Key Levels (1 to 3 weeks) Pivot (key support): 2178 Resistances: […]
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Pivot (key support): 2178
Resistances: 2245 & 2303
Next supports: 2145/32 & 2100
Last week, the U.S. SP 500 Index (proxy for the S&P 500 futures) has staged the expected pull-backed/consolidation towards the medium-term pivotal support at 2178 (printed a low of 2179 in today, 05 December Asian session) after the announcement of the resignation of the incumbent Italian PM Renzi due to his defeat in the referendum on Italy’s constitutional reforms to reduce to power of the Senate. Please click on this link for a recap of our previous weekly technical outlook/strategy.
Technical elements have turned positive for the Index such as the daily RSI oscillator has managed to stage a rebound right at the 50% level which indicates a revival of medium-term upside momentum of price action.
Therefore, we are maintaining our bullish bias holding above the 2178 medium-term pivotal support for the Index to stage a further potential up move to target 2245 next. A break above 2245 may see a further rally towards 2303 within the on-going potential final stage of the “melt-up” phase.
However, failure to hold above the 2178 medium-term pivotal support is likely to invalidate the preferred bullish bias to see a deeper pull-back towards the next support at 2145/32 (the pull-back of the former descending trendline resistance from 15 August 2016 high).
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Intermediate resistance: 18430/550
Pivot (key resistance): 18800
Supports: 17900, 17740 & 17500
Next resistance: 19550
The Japan 225 Index (proxy for the Nikkei 225 futures) has indeed shaped the final push in the first half of last week (printed a high of 18748) right below the 18800 medium-term pivotal resistance before it staged the expected pull-back (down by 2.6% from 01 December 2016 high of 18748 to today’s Asian session low of 18238). Please click on this link for a recap of our previous weekly technical outlook/strategy.
Technical elements remain unchanged with the USD/JPY also showing the similar potential pull-back/consolidation configuration below the 114.60/80 medium-term pivotal resistance. Therefore, as the 18800 medium-term pivotal resistance is not surpassed, the Index is likely to see a pull-back/consolidation towards the 17900/740 support zone with a maximum limit set at 17500 before a recovery materialises.
On the other hand, a clearance above the 18800 medium-term pivotal resistance may invalidate the preferred pull-back/consolidation scenario to see a continuation of the rally to target the next resistance at 19550.
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Intermediate support: 22460
Pivot (key support): 21900
Resistances: 23100 (upside trigger), 24500 & 25400
Next support: 21680/400
Technical elements remain unchanged and the a break above 23100 is still required for the bulls of the the Hong Kong 50 Index (proxy for Hang Seng Index futures) to stage a potential breakout from the three months plus of sideways range configuration in place since 09 September 2016. Thus, a daily close above 23100 is likely to trigger the start of a potential medium-term (1 to 3 weeks) of up move to target the next resistance at 24500 in the first step.
However, failure to hold above the 21900 medium-term pivotal support may invalidate preferred bullish bias to see a further slide to test the next support zone at 21680/400 (the pull-back support of the former “symmetrical triangle range” bullish breakout & the ascending trendline in place since 11 February 2016 low).
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Pivot (key support): 5370
Resistances: 5441 (upside trigger) & 5580/5610
Next supports: 5300 (downside trigger) & 5050
The Australia 200 Index (proxy for the ASX 200 futures) has pull-backed, tested and held above the former descending trendline resistance from 01 August 2016 high now turns pull-back support and also the 5370 medium-term pivotal support.
Right now, it needs to clear above the 5441 intermediate resistance to reinforce to bulls to stage a potential further up move to target the 5580/5610 resistance.
On the other hand, a break below the 5370 medium-term pivotal support is likely to negate the bullish tone to see a further slide to retest the 5300 level (lower boundary of an ascending channel in place since the 10 February 2016 low). Only a daily close below 5300 may trigger a deeper decline to retest the U.S. Presidential Election Day swing low area of 5050.
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Resistances: 10810, 10990 & 11190
Supports: 10230/200 & 9965
Populism movement continues on the rise in Europe with the latest “No”’ vote by the Italians on their constitutional reforms that triggered the resignation of the incumbent Italian PM Renzi.
However, the Germany 30 Index (proxy for the DAX futures) has responded with a positive note and rallied by 1.8% in the first opening hour in today, 05 December European session (the same modus operandi seen in the vote of Brexit and the recent outcome of the U.S. presidential election).
Is the market under-pricing risk where the lack of constitutional reforms in Italy may see the collapse of the troubled Monte dei Paschi bank which can trigger a European wide banking crisis? From a technical analysis perspective, the Germany 30 Index is still trading below a “stubborn” range resistance that is in place since 15 August 2016 at 10810. Therefore, we prefer to adopt a neutral stance between 10810 and 10230/200. Only a clear break (daily close) above 10810 is likely to trigger a potential up movement to target the next resistances at 10990 and 11190.
Charts are from City Index Advantage TraderPro
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