A couple of down sessions to begin the week did not have much of an impact as the iShares Stoxx Europe 600 headed for a flat week by Friday afternoon. Two markets, Spain (+2.03%) and Belgium (1.13%), gained more than 1%. On Thursday, Belgium was changed from Uptrend Under Pressure to Confirmed Uptrend after the index made a new 52-week high. Denmark fared the worst this week, losing 1.62%. On Tuesday, it changed from Confirmed Uptrend to Uptrend Under Pressure after the index recorded its fifth distribution day. Before Friday’s trading, 12 out of 18 European indices were in a Confirmed Uptrend. France and Germany remain at 52-week highs while the U.K. is 1% off the level.
Author: Vinaya Kumar
Global Focus Developed Long
Australia’s ASX All-Ordinaries Index gained 0.6% this week, bouncing slightly higher from 50-day moving average support. The index did not pick up any additional distribution days but still has four in the past five weeks. Resistance is about 1.3% higher at AUD 5,880.
Global Focus Emerging Long
Mainland Chinese markets traded mixed this week as both indices continue to test resistance. The Shanghai is trading 3% off 52-week highs and has appeared more constructive than the Shenzhen which is trading 6% off 52- week highs. To shift to an Uptrend, we are looking for either a move to 52-week highs for the Shanghai or a follow-through day in the Shenzhen. China’s February CPI slowed to 0.8% y/y as food prices fell after the Lunar New Year. January-February CPI rose 1.7%.
Global Focus Frontier Long
US Focus Long
Thanks to a sharp 1.62% gain on Wednesday, the iShares Stoxx Europe 600 index was heading toward a weekly gain of almost 1.2% by Friday afternoon. The index is at its highest level since December 2015 and remains in a Confirmed Uptrend. Before Friday’s close, ten out of 16 indices were in a Confirmed Uptrend. As of Thursday, Italy was by far the strongest performer (+4.54%), followed by Ireland (+2.93%) and Spain (+2.78%).
European Focus Long
Thanks to a sharp 1.62% gain on Wednesday, the iShares Stoxx Europe 600 index was heading toward a weekly gain of almost 1.2% by Friday afternoon. The index is at its highest level since December 2015 and remains in a Confirmed Uptrend. Before Friday’s close, ten out of 16 indices were in a Confirmed Uptrend. As of Thursday, Italy was by far the strongest performer (+4.54%), followed by Ireland (+2.93%) and Spain (+2.78%).
Global Focus Developed Long
Australia’s ASX All-Ordinaries Index lost 0.2% this week, trading down to its 50-day moving average. The index picked up two additional distribution days and now has five in the past five weeks. If the 50-day does not hold, the next support level is about 2% lower at its 10-day moving average, AUD 5,658.
Global Focus Emerging Long
Mainland Chinese markets pulled back this week, led by the Shanghai which was down 1%. The Shenzhen traded flat, but continues to look the weaker of the two, trading closer to the 40-week moving average and 7% off highs vs. 3% for the Shanghai. We continue to wait for a strong move that would constitute a follow-through day and provide more conviction in a continued rally.
Global Focus Frontier Long
US Focus Long
The market has begun to consolidate gains that we have seen over the last several weeks. We are looking for distribution to stay low, for price to hold above support levels, and for leadership to consolidate constructively above moving average support. Should the market pullback, we will be looking for the 21-DMA on both the S&P 500 and Nasdaq to hold. This level has been tested numerous times since the election and will likely be the market’s first test before the 50-DMA. We remain in a Confirmed Uptrend, still with only one distribution day on the S&P 500 and two on the Nasdaq.
