The U.S. market is in an Uptrend Under Pressure. The S&P 500 finished up for a fourth day on Thursday for its strongest day in two weeks, retaking the 21-DMA (3,870). It is now 1% below the June peak (3,946) and 2% below the 50-DMA (3,978). The Nasdaq continued its short-term lead and posted its best day since the follow-through day (FTD) two weeks ago, up over 2%, although on lower volume than the prior day. It is now well above the 21-DMA (11,368) with next resistance at the June peak and declining 50-DMA (both 11,677). Distribution day counts have been steady at one and two, respectively, for the past week.
Author: Vidhya M
Won Europe Today
We released our Weekly Global Laggards Report today. Click here to access the report. The stocks highlighted in this report are laggards relative to their own domestic markets. We recommend that they be underweighted as they may be vulnerable to further downside risk and underperformance. European names highlighted this week include Dsm (DSM.NL; DSM:NA), Mtu Aero Engines (MTXX.DE; MTX:GR), Aena Sme (AENA.ES; AENA:SM), Accor (AC.FR; AC:FP), Danske Bank (DAB.DK; DANSKE:DC), Carrefour (CRFR.FR; CA:FP), and Nokia (NOK1.FI; NOKIA:FH).
Won Global View
The U.S. market is in an Uptrend Under Pressure. The S&P 500 finished up slightly for a second day as it touched the 21-DMA (3,868) before closing a bit off the highs of the day. It has retaken the lows of the follow-through day (FTD) from last week (3,821) but remains 0.6% below the 21-DMA. The Nasdaq closed positive as well and was able to close just above the 21-DMA (11,346) and the lows from the FTD (11,337).
Won Europe Today
Yesterday,
- European markets closed higher after a sharp correction on Tuesday due to concerns regarding recession and
reports that new orders to German manufacturers rose in May, for the first time since the Russia-Ukraine conflict
began. Concerns around an economic slowdown persist as another rate hike of 50–75bps is expected per the
Fed’s June meeting minutes. We continue to recommend a cautious approach to adding risk. Remain defensive
with a focus on high relative strength ideas that are part of leading and/or improving industry. - The Stoxx 600 corrected 166bps while continuing to form the right side of a stage-one 12-week flat base. The index
is trading below its key support levels and 12% below the pivot. Technology, Travel, and Health Care led the rally,
climbing 312bps, 276bps, and 167bps, respectively, while Oil declined 152bps. Among other major indices,
France’s CAC, Germany’s DAX, and the U.K.’s FTSE closed in the green, gaining 203bps, 156bps, and 117bps,
respectively. - Among the 17 indices we track in Europe, 14 closed in the green. Austria, Norway, and Spain closed in the red.
With no change in market conditions, three indices are in a Confirmed Uptrend, Portugal is in an Uptrend Under
Pressure, five are in a Rally Attempt, and eight in a Downtrend. The average distribution day count stands at 3.3.
Actionable names in the Focus List include AstraZeneca (AZN.GB; AZN:LN), Edp Renovaveis (EDPR.PT;
EDPR:PL), and Man Group (EMG.GB; EMG:LN).
Won Global View
The U.S. market is in an Uptrend Under Pressure. The S&P 500 began a holiday-shortened week with a slight gain, reversing higher after trading down over 2% yesterday morning. It is just above the lows of the follow-through day (FTD) from last week (3,821) but remains about 1% below the 21-DMA (3,868). The Nasdaq posted a 1.8% gain, also reversing after trading over 2% lower to start the day. It is just below its 21-DMA (11,340) and lows from the FTD last week (11,340). Indices still have one and two distribution days, respectively.
Won Europe Today
Yesterday,
- European markets had a very weak day as the fear of recession grips the markets. All the 17 indices that we track
closed in negative territory with many of them falling more than 2% including the Stoxx 600. Volume was higher
across the board. We recommend that investors remain very cautious while adding any new risk. - The Stoxx 600 lost 2.1% after finding resistance at its declining 10-DMA. It is testing support at 400 price levels. The
majority of sectors closed in negative territory with Oil & Gas stocks losing more than 6% due to retreat in crude
prices. - Among other major indices, France’s CAC and Germany’s DAX continue to find resistance along their declining 10-
DMA. France’s CAC broke below its June 2022 lows. The U.K.’s FTSE 100 found supply at its declining 21-DMA
and recorded its second distribution day. - Luxembourg, Spain, Finland, and France were shifted to a Downtrend after they broke below their recent lows. In
addition, Portugal and Switzerland also recorded distribution days. - Actionable names in the Focus List include Edp Renovaveis (EDPR.PT; EDPR:PL), AstraZeneca (AZN.GB;
AZN:LN), and Man Group (EMG.GB; EMG:LN).
Won Global View
The U.S. market is in an Uptrend Under Pressure. The S&P 500 and Nasdaq reversed from their respective 10-
WMA early last week, adding distribution and breaking below the 21-DMA (S&P 500: 3,872; Nasdaq: 11,343). There is
no clear support above year-to-date lows (S&P 500: 3,636; Nasdaq:10,565), which if breached, would result in the
market status moving back to a Downtrend. The distribution day count stands at one and two, respectively.
Won Europe Today
We released our European Weekly Summary yesterday. Click here to access the report. Key points from it include:
- European majors closed in the red after establishing a short-term support zone around 400–403 levels in the last
three weeks. - The majors are still overextended to the downside and have found some support. A technical bounce to the shortterm moving averages is expected if the current support levels hold.
- Defensive sectors and Energy led the rally last week. On our rotation chart, Retail, Financials, and Tech are starting
to show signs of improvement in the short-term momentum, while Energy continues to show a pause in its shortterm momentum (over four weeks).
Won Europe Today
On Friday,
- European markets pared their gains to close flat to mixed. Most of the leading indices continued to lag after finding
supply at their respective declining 21-DMA. We recommend that investors be very cautious while adding any new
risk. - The Stoxx 600 closed flat. The next support is at 400 price levels. Among sectors, Technology stocks lost more
than 2% while Utilities led the bulls. Among other major indices, France’s CAC continues to trade below its 21-DMA.
Germany’s DAX found support at March 2022 levels after a gap down on June 30. The U.K.’s FTSE continues to
find supply at its declining 21-DMA. It is in a Confirmed Uptrend. - Among the 17 indices that we track in Europe, the U.K., the Netherlands, Norway, Luxembourg, the Stoxx 600, and
Austria closed in negative territory. Actionable names in the focus list include Edp Renovaveis (EDPR.PT;
EDPR:PL), AstraZeneca (AZN.GB; AZN:LN), and Man Group (EMG.GB; EMG:LN).
Won Global View
The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq declined 0.9% and 1.3%,
respectively, in higher volume. Both indices were unable to rally above the 10-DMA (S&P 500: 3,826; Nasdaq: 11,217).
The distribution day count increased to one and two, respectively. The market status will move back to a Downtrend
should year-to-date lows (S&P 500: 3,636; Nasdaq: 10,565) undercut.
