The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq rallied strongly for a second straight week, pushing narrowly above 100-DMA (S&P 500: 4,122; Nasdaq: 12,349) resistance Friday. Though the Nasdaq has also cleared above June highs (12,320), the S&P 500 still faces resistance at that level (4,177). The 10- and 21-DMA (S&P 500: 3,943; Nasdaq: 11,715) have now crossed above the 50-DMA to act as the next level of near-term support. The distribution day count remains at five each, with one day expiring on the S&P 500 and two on the Nasdaq this week.
Author: Vidhya M
Won Europe Today
On Friday,
- European markets closed strongly in the green. In July, European majors had the best monthly gains since November 2020. The majors are setting up constructively for the next leg of the move to their long-term moving averages after forming a base in the last couple of months. We still see many overhead supply zones which need to be taken out and held.
- We recommend becoming incremental in adding risk with a focus on high relative strength ideas that are part of leading and/or improving industry.
- The Stoxx 600 ended 1.3% higher on above average volume and currently sits 11% off highs.
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- The index has retaken and held above the downward sloping trendline, a strong supply zone in two prior occasions this year (April and June). The index has retaken its 100-DMA with Friday’s close and continues to hold above its 50-DMA. Next resistance is at 445 levels (1.5% above) and its 200-DMA (3% above). Support for the index remains at its 100-DMA (0.9% below), followed by its 50-DMA (3.7% below) and ~400 (8.9% below). Financial Services, Energy, and Construction stocks outperformed, while Health Care stocks underperformed.
- Among major indices, France’s CAC and Germany’s DAX are trading above their 21- and 50-DMA while remaining below their 200-DMA. The U.K.’s FTSE has retaken its 200-DMA and is now trading above all its key moving averages.
- Among the 17 indices we cover, most closed in the green. Norway led the advances, up 2.3%. Ireland was shifted to a Confirmed Uptrend after its follow-through day. Three indices are in an Uptrend Under Pressure, two are in a Rally Attempt, and 12 are in a Confirmed Uptrend.
- Actionable names in the Focus List include Wolters Kluwer (WSG.NL; WKL:NA), Compass Group (CPG.GB; CPG:LN), Man Group (EMG.GB; EMG:LN), Novo Nordisk (NON.DK; NOVOB:DC), Neoen (NEOP.FR; NEOEN:FP), Ipsos (IPS.FR; IPS:FP), Solaria Energia YMedio Ambiente (SEM.ES; SLR:SM), Terna Energy (TEN.GR; TENERGY:GA), Serco Group (SRP.GB; SRP:LN), Rwe (Xet) (RWEX.DE; RWE:GR), and AstraZeneca (AZN.GB; AZN:LN).
Won Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq bounced 2.6% and 4%, respectively, off 50-DMA support, albeit on below average volume. To remain constructive, we would like to see indices consolidate while avoiding distribution. Currently, the distribution day count stands at five on each index.
Won Europe Today
Yesterday
- European markets had a positive session with most indices closing marginally higher. Volumes were mixed. We continue to recommend that investors remain cautious while adding new risk.
- The Stoxx 600 gained 0.5% on higher volume. It continues to consolidate above its 50-DMA. Among sectors, Technology, Oil & Gas, and Banks gained more than 1%, while Travel & Leisure rose 3%. Defensive sectors such as Health Care lagged.
- Among other major indices, France’s CAC continues to consolidate above its 50-DMA, Germany’s DAX is testing support at its 10-DMA, and the U.K.’s FTSE managed to hold on to its 50-DMA.
- Among the 17 major indices that we track in Europe, Denmark, Finland, and Switzerland closed in negative territory, with Switzerland recording its fifth distribution day. Actionable names in the Focus List include Compass Group (CPG.GB; CPG:LN) and Ipsos (IPS.FR; IPS:FP).
Won Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq pulled back to their respective 50-DMA (S&P 500: 3,919;
Nasdaq: 11,509) in higher volume. The 10-, 21-, and 50-DMA are all converging near current prices. A close below all three will likely result in a shift in market status back to an Uptrend Under Pressure. The distribution day count continues to steadily rise, now at five each.
Won Europe Today
Yesterday,
- European markets had a flat-to-negative session with some indices recording a distribution day. Volume was
generally higher. We believe the markets are likely to consolidate here. However, we continue to recommend that
investors remain cautious while adding any new risk. - The Stoxx 600 ended flat and continued to consolidate above its 50-DMA. Among sectors, Technology stocks lost
1.5%, Financial Services were down more than 2%, while defensive sectors like Food & Beverage and Health Care
gained more than 1%. - Among other major indices, France’s CAC recorded its second distribution day. Germany’s DAX recorded its third
distribution day and is finding support at 13,100 price level. The U.K. ‘s FTSE 100 pared all its gains, forming a
downside reversal to end flat. - Among the 17 major indices that we track in Europe, only Denmark and Norway closed in the positive territory.
Switzerland recorded its fourth distribution day. The average distribution day count stands at 1.9. - Actionable names in the Focus List include Compass Group (CPG.GB; CPG:LN), Ipsos (IPS.FR; IPS:FP), Novo
Nordisk (NON.DK; NOVOB:DC), and Serco Group (SRP.GB; SRP:LN).
Won Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq closed mixed but continue to consolidate above their 50-DMA support (S&P 500: 3,919; Nasdaq: 11,505). The distribution day count stands at four on each index.
Won Europe Today
We released our Weekly European Summary yesterday. Click here to access the report. Key points from it include:
European majors had the best weekly gains since late May. The ECB delivered its first rate hike in over a decade
on Thursday, with more hikes expected in subsequent meetings. The Stoxx 600 was shifted to a Confirmed Uptrend
with Monday’s close as it reclaimed the previous rally high.
The market breadth improved with all sectors participating. Transportation, Cyclicals, and Technology led the rally.
Rotation Chartm, while Energy, Basic Materials, and Financial continued to lag short-term momentum (over four
weeks).
Won Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq regained and are consolidating above their 50-DMA (S&P 500: 3,918; Nasdaq: 11,497) for the first time since March. Look for near-term support at the sharply rising 10- and 21-DMA followed by the 50- DMA. The distribution day count stands at four each.
Won Europe Today
On Friday,
- European markets continued to rally last week with some of the leading indices reclaiming their respective 50-DMA.
We expect markets to consolidate here, preferably on low volumes. We recommend that investors remain very
cautious while adding any new risk. - The Stoxx 600 continues to consolidate above its 50-DMA though on subdued volume. Among sectors, Real Estate
stocks surged more than 4%, Oil & Gas and Utilities gained more than 1%, while Banks and Telecom stocks
lagged. - Among other major indices, France’s CAC continues to consolidate above its 50-DMA, while Germany’s DAX and
the U.K.’s FTSE 100 formed a downside reversal after finding supply at their respective declining 50-DMA. - Among the 17 indices that we track in Europe, Austria, Belgium, Finland, and Switzerland closed in negative
territory with Belgium recording its fourth distribution day. Actionable names in the Focus List include Compass
Group (CPG.GB; CPG:LN), Ipsos (IPS.FR; IPS:FP), Man Group (EMG.GB; EMG:LN), Novo Nordisk (NON.DK;
NOVOB:DC), Serco Group (SRP.GB; SRP:LN), and Wolters Kluwer (WSG.NL; WKL:NA).
