The U.S. market remains in a Confirmed Uptrend. Indices continue to establish small progress since Monday’s follow-through day. The
S&P 500 is 1% below resistance at its declining 50-DMA (4,626) but has held above support at the 200-DMA (4,440). The Nasdaq is
approaching resistance at its 200-DMA (14,734).
Author: admin
WON Europe Today
Yesterday,
- European markets closed in the green for the third consecutive day due to market optimism about positive earnings
updates from top U.S. and European companies such as Alphabet, AMD, GM, Team Viewer, Glencore, Novo
Nordisk, and Vodafone. The earnings updates have demonstrated that companies have adapted to inflation- and
supply-related issues, which is expected to calm the market volatility. Also, the Fed is expected to tone down the
aggression of its price hikes, which has helped the markets. We continue to recommend that investors remain
patient and accumulate high-quality ideas displaying strong relative strength and reclaiming their key support levels
while reducing their positions in stocks breaching their key long-term support levels. - The Stoxx 600 gained 59bps, regaining its key support levels. The rally was led by the Chemicals, Financial
Services, and Media sectors, which gained 1.2%, 1.1%, and 1.1%, respectively. - Among the other major indices, France’s CAC gained 0.22%, reclaiming its 21-DMA. Germany’s DAX gained 0.14%
and is still testing immediate resistance at its 100-DMA followed closely by a declining 50-DMA. The U.K. FTSE 100
gained 0.63% and is starting to consolidate above its 21-DMA support level. - Among the 17 indices we track in Europe, 13 closed in the green while Finland and Spain closed in the red. As
Ireland has been upgraded to a Confirmed Uptrend from a Rally Attempt, two indices are in a Confirmed Uptrend,
nine in a Rally Attempt, and six remain in an Uptrend Under Pressure. With no distribution day recorded yesterday,
the average distribution day count stands at 5.4. - Actionable names in the Focus List include Compass Group (CPG.GB; CPG:LN), Jeronimo Martins (JMT.PT;
JMT:PL), Beneteau (CHBE.FR; BEN:FP), and Aker BP (AKEP.NO; AKRBP:NO).
Won Global View
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq continued to push higher post Monday’s follow-through.
The S&P 500 is set to test resistance at its declining 50-DMA (4,629) with support at the 200-DMA (4,439). The Nasdaq is set to test
resistance at its 200-DMA (14,731).
WON Europe Today
Yesterday,
- European markets closed in the green for the second consecutive day, ahead of the monetary policy meetings of
the European Central Bank and Bank of England. With potential interest rate hikes already priced in ahead of the
meetings, European markets are optimistic after a turbulent January. Although manufacturing activity in European
countries has picked up, which is expected to relieve supply chain bottlenecks, such improvement is not evenly
spread across all countries in the Eurozone. We recommend investors remain cautious and accumulate highquality ideas showing strong relative strength and reclaiming their key support levels while reducing positions in
stocks breaching their key long-term support levels. - The Stoxx 600 gained 113bps, regaining its 21-DMA support level and testing resistance at a declining 50-DMA. The
rally was led by the Mining, Bank, and Oil sectors, which gained 3.5%, 2.4%, and 2.0%, respectively.
Among other major indices, France’s CAC gained 1.43% on good volume, regaining its 50-DMA and testing
resistance at a declining 21-DMA. Germany’s DAX gained 1.0% and is testing immediate resistance at its 100-
DMA, followed closely by a declining 50-DMA. The U.K.’s FTSE 100 also gained 1.0%, regaining its rising 21-DMA
support level. - Among the 17 indices we track in Europe, all closed in the green. As Denmark has been upgraded to a Confirmed
Uptrend from a Rally Attempt, one index is in a Confirmed Uptrend, 10 are in a Rally Attempt, and six remain in an
Uptrend Under Pressure. With no distribution day recorded yesterday, the average distribution day count stands at
5.4. - Actionable names in the Focus List include Compass Group (CPG.GB; CPG:LN), Jeronimo Martins (JMT.PT;
JMT:PL), Beneteau (CHBE.FR; BEN:FP), and Aker BP (AKEP.NO; AKRBP:NO).
Won Global View
The U.S. market has been upgraded to a Confirmed Uptrend. Indices staged a day six follow-through day. The S&P 500 rose 1.8%
on higher volume and regained its 200-DMA (4,436), which will now serve as a level of support. The Nasdaq jumped 3.4% on slightly
higher volume but remains below resistance at the downward sloping 21-DMA (14,395) followed by its 200-DMA (14,728).
WON Europe Today
We released our European Weekly Summary yesterday. Click here to access the report. Key points from it include:
Last week was another bearish and volatile week for the European markets as investors exited risky assets amid
fear of a hawkish Fed statement and slowing economic growth. Corporate earnings have so far failed to provide
confidence about the stalling recovery. We maintain a cautious view on the overall market and recommend a
patient approach to adding risk. Continue to focus on ideas showing strong relative strength while reducing
exposure to lagging ideas.
Energy sector led the markets last week. On our rotation chart, Energy, Financial, and Transportation showed
improving short-term momentum (over four weeks). Technology, Health Care, and Retail stocks continue to show
weak trends in short-term momentum (over four weeks).
The European Focus List Update: We added none and removed Straumann Holding (STMN.CH; STMN:SW), EQT
(EQT.SE; EQT:SS), Dassault Systèmes (DSY.FR; DSY:FP), Pandora (PND.DK; PNDORA:DC), Sika (SIKA.CH;
SIKA:SW), and Interpump Group (IP.IT; IP:IM). The list currently consists of 23 stocks.
Won Global View
The U.S. market remains in a Rally Attempt. Despite Friday’s strong rally, day-over-day volume was lower, negating a potential followthrough. Today will mark day six of the attempted rally. We will upgrade the market status to a Confirmed Uptrend should a follow-through
day occur or shift back to a Downtrend should last Monday’s lows undercut. The S&P 500 is now sitting just under 200-DMA (4,435)
resistance as the 10-, 21-, and 50-DMA are all now turning lower. Near-term support remains Monday’s low of 4,222. The Nasdaq is still
trading 15% off highs with near-term resistance at the rolling 10-DMA (13,959) and support at 13,094.
WON Europe Today
On Friday,
- European markets closed in the red after closing in the green for three consecutive days. The uncertainty
surrounding geopolitical issues between Russia and the NATO nations over Ukraine coupled with the Fed’s
hawkish policy stance has led to volatile markets. We recommend that investors remain patient and maintain a
cautious approach toward adding risk by removing any names that have breached their long-term support levels
and only adding stocks that have registered excellent earnings and have consolidated above their support levels. - The Stoxx 600 dropped 102bps, trading below its key support levels and finding resistance at its 100-DMA. Almost
all sectors except Retail and Travel closed in the red. While Retail and Travel gained 0.8% and 0.7%, respectively,
sectors such as Mining, Auto and Technology dropped significantly by 2.8%, 1.8%, and 1.7% respectively. - Among other major indices, France’s CAC dropped 0.8% on high volume, breaching its 50-DMA and recording a
distribution day while Germany’s DAX dropped 1.3%, continuing to trade below its key moving averages. The FTSE
100 dropped 1.2% and recorded a distribution day, due to profit booking ahead of the Bank of England’s meeting
where lending rates are expected to increase 25bps. - Among the 17 indices we track in Europe, 16 closed in the red while only Ireland closed in the green. We upgraded
Denmark, Ireland, Spain, Sweden, and Switzerland to a Rally Attempt. Out of the 17, 10 indices are in an Rally
Attempt, six in an Uptrend Under Pressure, and one in a Downtrend. The average distribution day count of
European indices stands at 1.6. - Actionable names in the Focus List include Compass Group (CPG.GB; CPG:LN), Jeronimo Martins (JMT.PT;
JMT:PL), Beneteau (CHBE.FR; BEN:FP), and Aker BP (AKEP.NO; AKRBP:NO).
U.S. Economic Summary
Q4 GDP expanded 6.9%, the strongest in five quarters:
The U.S. economy grew 6.9% in Q4, according to preliminary estimates, 140bps above market expectations. The
expansion for the quarter reflected the increases in private inventory investment, exports, personal consumption
expenditure (PCE), and non-residential fixed investment, which were partly offset by decreases in federal, state, and
local government spending.
Won Global View
The U.S. market remains in a Rally Attempt. The S&P 500 reversed off 200-DMA resistance, closing lower for a third straight session.
Despite the reversal, the index held above Monday’s low, keeping the attempted rally intact. The Nasdaq staged a downside reversal as
well, but also closed above Monday’s lows. Today is day five of an attempted rally. We will upgrade the market status to a Confirmed
Uptrend should a follow-through day occur or shift back to a Downtrend should Monday’s lows undercut.
