The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq are now testing all-time highs after regaining their respective 50-DMAs earlier in the week. We will be looking for each to break into new highs in strong volume next week before shifting the market back into a Confirmed Uptrend.
Author: Pramod Gopal
European Focus Long
After poor start to the week, the European benchmark Stoxx 600 index recovered in the second half of the trading week, ending with a weekly gain of approximately 0.7%. Most European indices followed a similar pattern, with gains Wednesday through Friday offsetting losses on Monday and Tuesday. We made a number of status changes this week: The Stoxx 600, France, Germany, the Netherlands, Portugal, Spain, Finland, and Sweden were moved to a Rally Attempt. We also moved Denmark to a Confirmed Uptrend.
Global Focus Developed Long
Australia’s ASX All-Ordinaries Index declined 0.30% this week. It is trading 0.04% above its 50-DMA and 3% below 52-week highs. One distribution day was added this week, increasing the total to four. The index remains Under Pressure.
Global Focus Emerging Long
Mainland Chinese markets advanced this week, led by the Shenzhen index, which gained 2.4%. The Shanghai index continues to trade more constructively than the Shenzhen index, trading near its 52-week highs and 3% above its 10-WMA. The index continues to trend higher after breaking its resistance level of 3,300 last week. Both indices are now trading above their 10 WMA and 40-WMA and remain in a Confirmed Rally.
Global Focus Frontier Long
US Focus Long
The U.S. market remains in an Uptrend Under Pressure. Distribution on the Nasdaq remains elevated at seven days. The index still has an A/D Rating of E and price continues to hit resistance around its 50-DMA and a newly formed downward trending channel line. Additionally, the U.S. Focus List count has fallen from 68 to 60 names over the past three weeks, with ~30% of the current list trading below their 50-DMAs. Going forward, we will be looking for distribution to subside and for price/volume action to improve on both the major averages and leadership ideas alike. We maintain our cautious stance on the general market.
European Focus Long
The European benchmark Stoxx 600 index traded sideways this week and, as of Thursday’s close, was flat on a weekly basis. The market remains in a Confirmed Downtrend. France also largely traded sideways, but the U.K. and Germany saw modest gains this week. France and Sweden were moved to a Rally Attempt this week.
Global Focus Developed Long
Australia’s ASX All-Ordinaries Index was up 0.08% this week and is trading 0.32% above its 50 DMA and 3% below 52-week highs. One distribution day was added this week, increasing the total count to four. The index remains Under Pressure.
Global Focus Emerging Long
Mainland Chinese markets held above their key 10-WMAs. The markets advanced this week led by the Shanghai index, which grew 1.92%. The Shanghai index continues to trade more constructively than the Shenzhen index, trading at 52-week highs and 3% above its 10-WMA. The index broke its resistance level of 3,300 on Friday, after three failed attempts in the last nine months. The Shenzhen index is still trading 2% below its 40-WMA. Both indices remain in a Rally Attempt, awaiting a follow-through day.
