Technicals
European Stocks Rebound, Meet Key Resistance
November 11, 2009 at 9:03 am by Ilya Spivak · Leave a Comment
WEEKLY STRATEGY
FTSE 100
Long-term Technical Outlook
The FTSE remains constructive until a drop below 4955. Potential channel resistance is not until 5483 today. The structure of the rally is bearish, taking the form of a correction (3 waves). What’s more, wave c is equal to wave a in percentage terms.
Short-Term Technical Outlook
The FTSE has risen to re-test resistance at 5298.54 for a potential double top. The hurdle to further bullish momentum is reinforced by support-turned-resistance at a rising trend line established from the low in August. A reversal will see near-term support at 5184.48.
DAX
Long-term Technical Outlook
The DAX has found support from a support line extended from the March and July lows. A short term former support line may act as resistance at the current level. A continuation of the bear trend would be signaled on a drop below 5313. In the event of a new high, the 6000-6110 zone is resistance.
Short-Term Technical Outlook
The German benchmark index has pushed above resistance at 56749, the 61.8% Fibonacci retracement level. From here, prices will aim to test support-turned-resistance at 57365, a level that has proved to be a significant inflection point at least since September.
CAC 40
Long-term Technical Outlook
The CAC 40 reached its 100% extension at 3892 and reversed sharply, eventually falling beneath the October low. A larger turn would be signaled on a drop below 3550. Trading above the October high would shift focus to 4000 and then channel resistance.
Short-Term Technical Outlook
French issues have pushed higher in a well-defined rising channel to surpass resistance at 3805.09 to find themselves squarely at the channel top. A correction lower now sees 3805.09 as support, while an acceleration of bullish momentum would aim for 3906.49.
IBEX 35
Long-term Technical Outlook
TThe IBEX reversed at January 2008 low of 1194. Also, the index broke beneath the October low (red line) and trendline support. The rally from 1118 raises the possibility that the break was false however. Trading to a new high would expose a measured level at 1247. Under 1118 signals that the larger decline has resumed.
Short-Term Technical Outlook
Spanish shares have advanced to re-test support-turned-resistance at the bottom of a rising channel that had previously contained prices since the lows in August. Continued bullish momentum will aim to test the double top at 1194.57, with near-term support at the 23.6% Fib mark (1172.38).
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB broke beneath its support line for several days as well as its 50 day SMA. The moving average may be resistance now. The rally from March is in 3 waves and the recent reversal occurred following what appears to be completion of an ending diagonal. This is bearish evidence so I am looking for the decline to continue.
Short-Term Technical Outlook
The FTSE/MIB has surpassed resistance at the 50% Fibonacci retracement level (23179.51) and now aims to challenge the 61.8% Fib at 23504.94. A break beyond that will look for a re-test of support-turned-resistance at 25502.02, the bottom of a rising channel that had guided prices since September.
European Stocks Find Support, Look to Retest Swing Highs
October 14, 2009 at 3:34 am by Ilya Spivak · Leave a Comment
WEEKLY STRATEGY
FTSE 100 Pivot Table
DAX 30 Pivot Table
CAC 40 Pivot Table
FTSE 100
Long-term Technical Outlook
The FTSE has reached the 100% extension of the 3461-4521 rally (5156). Parallel channel resistance at this level reinforces this level and increases the risk of a top and reversal. 5339 would be the next level of potential resistance.
Short-Term Technical Outlook
The FTSE continues to re-test 5231.19, a level initially marked by the bottom of a rising channel that had contained prices since August. A turn lower from here sees initial support at 5084.66, the 23.6% Fibonacci retracement level.
DAX
Long-term Technical Outlook
The DAX has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. Potential resistance prior to that point is 5870 (50% of decline from 8152). The mentioned 6113 is reinforced by 6168 (former support line in gray).
Short-Term Technical Outlook
The German benchmark index continues to look for direction between the latest swing top at 58185 and the 23.6% Fibonacci retracement level at 57296. A break lower will see support at 56752, the 38.2% Fib.
CAC 40
Long-term Technical Outlook
Similar to the DAX, the CAC 40 has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. However, price is close and potential parallel channel resistance reiforces the current area as one that may provide the supply required to produce a reversal.
Short-Term Technical Outlook
French issues have turned lower following a re-test of support-turned-resistance at a rising trend line that had guided shares higher since mid-August. A reversal lower from current levels eyes the 23.6% Fib at 3749.57.
IBEX 35
Long-term Technical Outlook
The IBEX has reached the January 2008 low. Former support is now resistance. RSI divergence warns of a trend change as well. Watch the trendline and top channel line as potential end points for the rally in the event that the advance continues. 1247 (100% extension) is also a level to expect a reversal if reached.
Short-Term Technical Outlook
Spanish shares continue to consolidate between 1193.82, the previous swing high, and the 23.6% Fibonacci retracement level at 1160.77. A series of lower highs hints at a bearish bias, with a break below immediate support eyeing the 38.2% Fib at 1140.32.
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB index encounters resistance from channel midline. Additional levels to watch are 24916 to 26464. The 100% extension of the 12332-20702 rally is near the top of this range.
Short-Term Technical Outlook
The FTSE/MIB has rebounded from initial support at 23842.96, the 23.6% Fibonacci retracement level, looking to take out the previous swing high at 24256.28. This will open the door for a move to challenge 24507.21, the top of a rising channel that has guided trading since early September.
European Stocks Retrace, Preapare to Renew Bearish Momentum
October 13, 2009 at 4:11 am by Ilya Spivak · Leave a Comment
WEEKLY STRATEGY
FTSE 100 Pivot Table
DAX 30 Pivot Table
CAC 40 Pivot Table
FTSE 100
Long-term Technical Outlook
The FTSE has reached the 100% extension of the 3461-4521 rally (5156). Parallel channel resistance at this level reinforces this level and increases the risk of a top and reversal. 5339 would be the next level of potential resistance.
Short-Term Technical Outlook
The FTSE has retraced higher to re-test support-turned-resistance at the bottom of a rising channel that had contained prices since August. A turn lower from here sees initial support at 5084.66, the 23.6% Fibonacci retracement level.
DAX
Long-term Technical Outlook
The DAX has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. Potential resistance prior to that point is 5870 (50% of decline from 8152). The mentioned 6113 is reinforced by 6168 (former support line in gray).
Short-Term Technical Outlook
The German benchmark index has pushed higher, breaking triple top resistance to pause ahead of 58185. Near-term support is seen at 57296, the 23.6% Fibonacci retracement level.
CAC 40
Long-term Technical Outlook
Similar to the DAX, the CAC 40 has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. However, price is close and potential parallel channel resistance reiforces the current area as one that may provide the supply required to produce a reversal.
Short-Term Technical Outlook
The German benchmark index has pushed higher, breaking triple top resistance to pause ahead of 58185. Near-term support is seen at 57296, the 23.6% Fibonacci retracement level.
IBEX 35
Long-term Technical Outlook
The IBEX has reached the January 2008 low. Former support is now resistance. RSI divergence warns of a trend change as well. Watch the trendline and top channel line as potential end points for the rally in the event that the advance continues. 1247 (100% extension) is also a level to expect a reversal if reached.
Short-Term Technical Outlook
The German benchmark index has pushed higher, breaking triple top resistance to pause ahead of 58185. Near-term support is seen at 57296, the 23.6% Fibonacci retracement level.
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB index encounters resistance from channel midline. Additional levels to watch are 24916 to 26464. The 100% extension of the 12332-20702 rally is near the top of this range.
Short-Term Technical Outlook
The FTSE/MIB has surpassed double top resistance at 23658.51. From here, prices target 24441.98, the top of a rising channel that has guided trading since early September.
European Stocks Rebound, Bias Still Favors Downside
October 6, 2009 at 3:07 am by Ilya Spivak · Leave a Comment
WEEKLY STRATEGY
FTSE 100 Pivot Table
DAX 30 Pivot Table
CAC 40 Pivot Table
FTSE 100
Long-term Technical Outlook
The FTSE has reached the 100% extension of the 3461-4521 rally (5156). Parallel channel resistance at this level reinforces this level and increases the risk of a top and reversal. 5339 would be the next level of potential resistance.
Short-Term Technical Outlook
The FTSE has found initial support at 4968.49, the 38.2% Fibonacci retracement level, and began to rebound a bit higher. Near-term resistance is seen at 5053.10, the 23.6% Fib. Beyond that, the bulls face support-turned-resistance at the bottom of a rising channel established from mid-August, now at 5142.96.
DAX
Long-term Technical Outlook
The DAX has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. Potential resistance prior to that point is 5870 (50% of decline from 8152). The mentioned 6113 is reinforced by 6168 (former support line in gray).
Short-Term Technical Outlook
The German benchmark index found initial support at 54520, the 61.8% Fibonacci retracement level, and popped back over the 50% mark. Continued bullish momentum will aim for a test of the 38.2% Fib at 55654.
CAC 40
Long-term Technical Outlook
Similar to the DAX, the CAC 40 has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. However, price is close and potential parallel channel resistance reiforces the current area as one that may provide the supply required to produce a reversal.
Short-Term Technical Outlook
French issues have seen bearish momentum lose steam ahead of the 50% Fibonacci retracement. Initial resistance lines up at 3683.31, the 38.2% Fib level. A push higher beyond that will likely see a test above the psychologically significant 3700.00 handle.
IBEX 35
Long-term Technical Outlook
The IBEX has reached the January 2008 low. Former support is now resistance. RSI divergence warns of a trend change as well. Watch the trendline and top channel line as potential end points for the rally in the event that the advance continues. 1247 (100% extension) is also a level to expect a reversal if reached.
Short-Term Technical Outlook
Spanish shares saw selling pressure let up just ahead of the 50% Fibonacci retracement level, with the subsequent rebound on pace to re-test the 23.6% mark at 1160.15. A break higher beyond that will aim to test rising wedge support-turned-resistance, now at 1174.95.
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB index encounters resistance from channel midline. Additional levels to watch are 24916 to 26464. The 100% extension of the 12332-20702 rally is near the top of this range.
Short-Term Technical Outlook
The FTSE/MIB found support at 22657.08, the 38.2% Fibonacci retracement level, after breaking past a rising trend line established from the swing lows in mid-August. A re-test of that trend line (now at 23070.94) may follow ahead before bearish momentum resumes.
European Stocks Extend Losses as Reversal Continues to Unfold
October 5, 2009 at 4:05 am by Ilya Spivak · Leave a Comment
WEEKLY STRATEGY
FTSE 100 Pivot Table
DAX 30 Pivot Table
CAC 40 Pivot Table
FTSE 100
Long-term Technical Outlook
The FTSE has reached the 100% extension of the 3461-4521 rally (5156). Parallel channel resistance at this level reinforces this level and increases the risk of a top and reversal. 5339 would be the next level of potential resistance.
Short-Term Technical Outlook
The FTSE has broken below support at the bottom of a rising channel to find a near-term bottom at the 38.2% Fibonacci retracement level. Continued bearish momentum will target the 50% Fib level at 4900.11. Near-term resistance is seen at 5053.10, the 23.6% mark.
DAX
Long-term Technical Outlook
The DAX has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. Potential resistance prior to that point is 5870 (50% of decline from 8152). The mentioned 6113 is reinforced by 6168 (former support line in gray).
Short-Term Technical Outlook
The German benchmark index has sold off sharply, finding near-term support at the 61.8% Fibonacci level. A break lower will target the 53818, the 76.4% Fib.
CAC 40
Long-term Technical Outlook
Similar to the DAX, the CAC 40 has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. However, price is close and potential parallel channel resistance reiforces the current area as one that may provide the supply required to produce a reversal.
Short-Term Technical Outlook
The German benchmark index has sold off sharply, finding near-term support at the 61.8% Fibonacci level. A break lower will target the 53818, the 76.4% Fib.
IBEX 35
Long-term Technical Outlook
The IBEX has reached the January 2008 low. Former support is now resistance. RSI divergence warns of a trend change as well. Watch the trendline and top channel line as potential end points for the rally in the event that the advance continues. 1247 (100% extension) is also a level to expect a reversal if reached.
Short-Term Technical Outlook
ASpanish shares have broken out of a rising wedge formation and are approaching support at the 50% Fibonacci retracement level. A break beyond that would target 1105.67, the 61.8% mark.
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB index encounters resistance from channel midline. Additional levels to watch are 24916 to 26464. The 100% extension of the 12332-20702 rally is near the top of this range.
Short-Term Technical Outlook
The FTSE/MIB has broken trend line support and now looks to have slipped below the 38.2% Fibonacci retracement level. Prices target the 50% mark at 22311.70 from here.
European Stocks Decline, Meet Initial Support
October 1, 2009 at 2:18 am by Ilya Spivak · Leave a Comment
WEEKLY STRATEGY
FTSE 100 Pivot Table
DAX 30 Pivot Table
CAC 40 Pivot Table
FTSE 100
Long-term Technical Outlook
The FTSE has reached the 100% extension of the 3461-4521 rally (5156). Parallel channel resistance at this level reinforces this level and increases the risk of a top and reversal. 5339 would be the next level of potential resistance.
Short-Term Technical Outlook
The FTSE has hit support at the bottom of a rising channel established from mid-August with negative divergence on the RSI oscillator pointing to a bearish bias. A break lower eyes the 23.6% Fibonacci retracement level at 5053.10.
DAX
Long-term Technical Outlook
The DAX has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. Potential resistance prior to that point is 5870 (50% of decline from 8152). The mentioned 6113 is reinforced by 6168 (former support line in gray).
Short-Term Technical Outlook
The German benchmark index continues to oscillate between the triple top at 57490 and the 23.6% Fibonacci retracement level at 56356. Negative RSI divergence argues for a selloff, with a break lower to challenge the 38.2% Fib at 55654.
CAC 40
Long-term Technical Outlook
Similar to the DAX, the CAC 40 has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. However, price is close and potential parallel channel resistance reiforces the current area as one that may provide the supply required to produce a reversal.
Short-Term Technical Outlook
French issues have sold off to meet rising trend line support, with negative RSI divergence hinting at continuation of bearish momentum. A break lower will target the 3703.08 – 3724.34 price congestion region.
IBEX 35
Long-term Technical Outlook
The IBEX has reached the January 2008 low. Former support is now resistance. RSI divergence warns of a trend change as well. Watch the trendline and top channel line as potential end points for the rally in the event that the advance continues. 1247 (100% extension) is also a level to expect a reversal if reached.
Short-Term Technical Outlook
A Rising Wedge with negative RSI divergence points to a bearish reversal ahead for Spanish issues. Initial support is seen at 1163.92, the wedge formation bottom, and is reinforced by resistance-turned-support in the 1152.28 – 1160.76 congestion area.
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB index encounters resistance from channel midline. Additional levels to watch are 24916 to 26464. The 100% extension of the 12332-20702 rally is near the top of this range.
Short-Term Technical Outlook
The FTSE/MIB looks to be on pace to forming a near-term top having shown bearish confirmation following an inverted hammer candlestick as well as clear negative RSI divergence. A reversal sees initial support at 22872.88 at a rising trend line established from mid-August.
European Equity Technical Outlook
September 30, 2009 at 12:37 pm by Jamie Saettele · Leave a Comment
WEEKLY STRATEGY
FTSE 100 Pivot Table
DAX 30 Pivot Table
CAC 40 Pivot Table
FTSE 100
Long-term Technical Outlook
The FTSE has reached the 100% extension of the 3461-4521 rally (5156). Parallel channel resistance at this level reinforces this level and increases the risk of a top and reversal. 5339 would be the next level of potential resistance.
Short-Term Technical Outlook
The FTSE may be on pace to put in a Double Top at 5189.88 as the RSI oscillator shows sharp negative divergence. A reversal lower would see initial support at 5082.28, the lower boundary of a rising channel established from mid-August. Alternatively, a break higher would face the channel top at 5305.42.
DAX
Long-term Technical Outlook
The DAX has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. Potential resistance prior to that point is 5870 (50% of decline from 8152). The mentioned 6113 is reinforced by 6168 (former support line in gray).
Short-Term Technical Outlook
Judging by strong negative divergence on the RSI oscillator, German benchmark index looks to be on pace to set a major Triple Top at 57490. Initial support is seen at 56788, the 14.6% Fibonacci retracement level.
CAC 40
Long-term Technical Outlook
Similar to the DAX, the CAC 40 has yet to reach its measured resistance point of 6113, which is where the 2 bull legs from the March low would be equal. However, price is close and potential parallel channel resistance reiforces the current area as one that may provide the supply required to produce a reversal.
Short-Term Technical Outlook
As with the DAX30, divergence with momentum studies on the CAC is hinting that a downward reversal is ahead as prices test 3847.86 once again. Initial support is seen at 3753.11, a rising trend line established from the swing low in mid-August.
IBEX 35
Long-term Technical Outlook
The IBEX has reached the January 2008 low. Former support is now resistance. RSI divergence warns of a trend change as well. Watch the trendline and top channel line as potential end points for the rally in the event that the advance continues. 1247 (100% extension) is also a level to expect a reversal if reached.
Short-Term Technical Outlook
A Rising Wedge with negative RSI divergence points to a bearish reversal ahead for Spanish issues. Initial support is seen at 1161.47, the wedge formation bottom.
S&P/MIB
Long-term Technical Outlook
The FTSE/MIB index encounters resistance from channel midline. Additional levels to watch are 24916 to 26464. The 100% extension of the 12332-20702 rally is near the top of this range.
Short-Term Technical Outlook
The FTSE/MIB looks essentially the same as most other European benchmark indexes, with negative RSI divergence suggesting prices are on pace to forming a near-term top. A reversal sees initial support at 22828.86 at a rising trend line established from mid-August.
Contact Jamie at jsaettele@dailyfx.com if you would like to receive his reports via email.
European Stocks Extend Losses as Bearish Momentum Accelerates
September 3, 2009 at 1:07 am by Ilya Spivak · Leave a Comment
Weekly Strategy
FTSE 100
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 4751, has been reached and is where the rally from 4096 is equal to 61.8% of the 3461-4521 rally. The next level is 5156, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The FTSE has broken out of the Rising Wedge that we identified earlier this week. Prices have now taken out support at the 38.2% Fibonacci retracement level (4816.64) and have turned range-bound between this and the 50% Fib at 4777.25. A move lower targets the 61.8% level at 4737.85.
DAX
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 5506, has nearly been reached and is where the rally from 4524 is equal to 61.8% of the 3589-5176 rally. The next level is 6113, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The German benchmark index has extended losses after yielding a bearish breakout as expected, with prices now consolidating between the 61.8% Fibonacci retracement level at 53198 and the 76.4% mark at 52587. Continued downward momentum will aim to challenge the swing bottom at 51770.
CAC 40
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 3535, has been reached and is where the rally from 2958 is equal to 61.8% of the 2466-3400 rally. The next level is 3892, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
Our bearish forecast for the French equities was validated as prices fell through the bottom of a bearish Rising Wedge chart formation. Near-term support has been marked at the 23.6% Fibonacci retracement level (3543.44), with a break below this juncture opening the door for a move to the 38.2% Fib at 3431.53.
IBEX 35
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 1124, has nearly been reached and is where the rally from 925 is equal to 61.8% of the 670-993 rally. The next level is 1247, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
As with most other European exchanges, Spanish shares sold off to break beyond the Rising Wedge we identified at the beginning of the week. Prices have broken below support at the 50% Fib level (1101.73) to find support at the 61.8% level (1089.80). A move lower from here will target the 76.4% Fib at 1075.04.
FTSE MIB
Long-Term Technical Outlook
There are 2 levels that most likely produce a top and neither has been reached. The first level, 22798, is where the rally from 17626 is equal to 61.8% of the 12332-20702 rally. The next level is 25996, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The FTSE/MIB looks essentially the same as other European benchmark indexes: prices validated our bearish scenario, breaking below Rising Wedge support to take out the 50% Fibonacci retracement level. Italian shares have now entered consolidation between this and the 61.8% Fib at 21619.65, with a break lower to target the 76.4% level at 21328.46.
European Stocks Validate Bearish Bias, Break Past Key Support
September 2, 2009 at 1:37 am by Ilya Spivak · Leave a Comment
Weekly Strategy
FTSE 100
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 4751, has been reached and is where the rally from 4096 is equal to 61.8% of the 3461-4521 rally. The next level is 5156, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The FTSE has broken out of the Rising Wedge that we identified earlier this week, with prices now positioned to test the 38.2% Fibonacci retracement level at 4816.64. A break beyond that will target the 50% Fib at 4777.25.
DAX
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 5506, has nearly been reached and is where the rally from 4524 is equal to 61.8% of the 3589-5176 rally. The next level is 6113, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The German benchmark index has sold off as expected and is now positioned above the 61.8% Fibonacci retracement level at 53198. A break lower targets the 76.4% level at 52587.
CAC 40
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 3535, has been reached and is where the rally from 2958 is equal to 61.8% of the 2466-3400 rally. The next level is 3892, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
Our bearish forecast for the French equities has been validated: prices fell through the bottom of a rising wedge formation and taken out the 38.2% Fibonacci retracement level at 3599.14. From here, the bears will look to take the index to the 50% Fib at 3560.47.
IBEX 35
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 1124, has nearly been reached and is where the rally from 925 is equal to 61.8% of the 670-993 rally. The next level is 1247, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
As with most other European exchanges, Spanish shares sold off to break beyond the Rising Wedge we identified at the beginning of the week. Prices now target the 38.2% Fibonacci retracement level at 1113.66.
FTSE MIB
Long-Term Technical Outlook
There are 2 levels that most likely produce a top and neither has been reached. The first level, 22798, is where the rally from 17626 is equal to 61.8% of the 12332-20702 rally. The next level is 25996, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The FTSE/MIB looks essentially the same as other European benchmark indexes: prices validated our bearish scenario, breaking below Rising Wedge support to challenge resistance-turned-support at 21981.13. A move lower from here would target the 21947.83 – 21762.62 congestion region.
European Stock Exchanges Position to Reverse Lower
August 31, 2009 at 1:08 am by Ilya Spivak · Leave a Comment
Weekly Strategy
FTSE 100
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 4751, has been reached and is where the rally from 4096 is equal to 61.8% of the 3461-4521 rally. The next level is 5156, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The FTSE is setting up a Rising Wedge chart formation indicative of a bearish reversal ahead. Negative divergence on the RSI oscillator bolsters the downward bias. Near-term support is seen at 4888.90.
DAX
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 5506, has nearly been reached and is where the rally from 4524 is equal to 61.8% of the 3589-5176 rally. The next level is 6113, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
As with the FTSE, the German benchmark index is showing a bearish Rising Wedge with negative RSI divergence. A break of support at 55023 opens the door for a move to resistance-turned-support at 54420.
CAC 40
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 3535, has been reached and is where the rally from 2958 is equal to 61.8% of the 2466-3400 rally. The next level is 3892, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
Another rising wedge is seen on the CAC 40, again with negative RSI divergence. Near-term support is seen at 3668.40. A break below this will likely see a test of the psychologically significant 3600.00 handle.
IBEX 35
Long-Term Technical Outlook
There are 2 levels that most likely produce a top. The first level, 1124, has nearly been reached and is where the rally from 925 is equal to 61.8% of the 670-993 rally. The next level is 1247, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
Spanish shares fit in with positioning noted on other key exchanges: a Rising Wedge points to a bearish bias, and negative RSI divergence offers confirmation. A break below the wedge bottom at 1141.81 opens the door for a move to the 23.6% Fibonacci retracement level (1128.42).
FTSE MIB
Long-Term Technical Outlook
There are 2 levels that most likely produce a top and neither has been reached. The first level, 22798, is where the rally from 17626 is equal to 61.8% of the 12332-20702 rally. The next level is 25996, which is where the 2 bull legs would be equal.
Short-Term Technical Outlook
The FTSE/MIB looks essentially the same as other European benchmarks, with a Rising Wedge and negative RSI divergence clearly in place. A move below the wedge bottom at 22609.38 will aim below the 22500.00 handle.
