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Weekly Market Brief: Forecasts For The FTSE, DAX, NASDAQ 100, S&P 500 And Dow

By Francesco BergaminiMarket OverviewOct 23, 2022 07:54AM ET
www.investing.com/analysis/weekly-market-brief-forecasts-for-the-ftse-dax-nasdaq-100-sp-500-and-dow-200631412
Weekly Market Brief: Forecasts For The FTSE, DAX, NASDAQ 100, S&P 500 And Dow
By Francesco Bergamini   |  Oct 23, 2022 07:54AM ET
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UK100
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US500
+0.25%
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DJI
+0.08%
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DE40
+0.11%
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IT40
+1.12%
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FTSE 100 (UKX)

The FTSE 100 index had a week up by + 1.62%. For the week ahead, we favor a recovery to at least 7,150. 

Indicators

A week of consolidation heralds a short-term uptrend: the price seems to want to get out of the tight trading range of 6,850 - 7,000.

Daily chart: FTSE100
Daily chart: FTSE100

What seems desirable to expect is a break to the upside, followed by a back test of the 7,000 area. This scenario could shift the balance in favor of more sustainable upside momentum.

MACD and RSI are both recovering and appear to support the index.

One indicator that makes us, for the moment, however, lean towards greater caution is the narrowing of the Bollinger bands. Similar setups have brought strong volatility in both directions.

We remain neutral on the FTSE100, the scenario is improving, and consolidation above 7,000 could give that long-awaited confirmation.

  • Support at 6,850
  • Resistance at 7,200

FTSE MIB 

The FTSE MIB index had a week up by + 3.04%. For the week ahead, we favor a bullish continuation to at least 22,400.

Indicators

Positive week for the FTSE MIB, which seems to want to exit the tight trading range of 20,400-21,700 and break to the upside of the bearish trendline since the beginning of 2022.

Daily chart: FTSEMIB
Daily chart: FTSEMIB

Looking at past price action, we can see that the 50-moving average (yellow line) has always played the role of dynamic resistance. At the moment, there are no particular indicators that suggest a different scenario.

MACD and RSI are positively up.

We are positive on the FTSEMIB, but we await the overcoming of the level of 21,500-22,000, which also coincides with the 50MA: the bearish trendline is very strong, and we believe that its break may require a long process and not a "simple" break to the upside.

  • Support at 20,700
  • Resistance at 22,800

DAX 40 (DAX)

The DAX index had a week up by + 2.36%. For the week ahead, we favor a bullish continuation to 13,000.

Indicators

A positive week for the German index, which saw the price reach the 50-day moving average (yellow line), has played the role of dynamic resistance since the beginning of 2022.

Daily chart: DAX
Daily chart: DAX

MACD and RSI are both recovering, which is favorable for the short to medium term.

We are positive on the DAX40 but look forward to a 12,500 back-test and overcoming 12,750. The trend is still strongly bearish, and the price is only consolidating in the wide range between 11,800 - 12,750.

  • Support at 12,000
  • Resistance at 13,600

S&P 500 (SPX)

The S&P 500 index had a week up by 4.74%. For the coming week, we favor a possible recovery of at least 3,900.

Indicators

A week that saw the short-term bearish trendline breaking upwards: this scenario is very optimistic, especially if confirmed by a back-test, it could lead to a quick test of the 3,900 level.

Daily chart: S&P 500
Daily chart: S&P 500

As already seen in the past, the SPX alternates phases of contraction with phases of expansion: narrowing the Bollinger bands seems to suggest that the price may be close to an intense phase of expansion and volatility.

We are positive on the S&P500 and looking forward to a consolidation above 3,800: this week's price action is exciting, but we note that the price has been substantially flat over the last month.

  • Support at 3,550
  • Resistance at 3,900

NASDAQ 100 (NDX)

The NASDAQ index had a week up by + 5.78%. For the week ahead, we favor a continuation to the upside till 11,600.

Indicators

A positive week for the Tech index saw the price consolidating above the 5-day moving average (red line) and could pave the way for short-medium term rises.

The internal MACD and RSI indicators are recovering and could support the index to the upside.

We are positive on the NASDAQ 100. At the same time, the trading range of 10,800 - 11,600 continues to be respected, and the scenario remains unchanged from the end of September to today: the narrowing of the Bollinger bands confirms strong volatility at the gates could give rise to medium-long-term long setups'.

  • Support at 10,400
  • Resistance at 12,000

DOW JONES (DJI)

The Dow Jones Industrial Average index had a week up by + 4.89%. For the coming week, we favor consolidation in the area of 31,000 - 31,500.

Indicators

Positive week that saw the price reach the 50-day moving average (yellow line), confirming the most recent recovery in strength.

Daily chart: Dow Jones
Daily chart: Dow Jones

MACD and RSI are both up: we note that the RSI is now at 60, a level that in the past acted as temporary resistance.

The upward exit from the Bollinger bands is positive as it seems to determine a change of pace. At the same time, it is desirable to expect a slight retracement before moving upward. Such a scenario would avoid hyper-extension setups.

We are positive on the Dow Jones and ready to consider long positions if a back-test of the previous breakpoints at 30,500 - 30,700.

  • Support at 29,170
  • Resistance at 32,000

TADAWUL (TASI)

The Tadawul All Share index had a week up by + 4.74%. For the coming week, we favor consolidation in the SAR 11,800 - 12,200.

Indicators

A week that saw the Saudi index reverse its short-term direction on the solid support at 11.250: the series of higher lows and highs that began at the end of September is certainly a positive indicator.

Daily chart: Tadawul All shares
Daily chart: Tadawul All shares

A consolidation above the 50-day moving average (yellow line) could open the door for more substantial moves to the upside.

MACD and RSI describe an optimistic scenario, although it should be noted that the latter is very close to the oversold area.

At the moment, we prefer to remain neutral on the Tadawul to understand if the price will be able to consolidate in the area of 11,800 - 12,200: a similar scenario could offer attractive extended opportunities.

  • Support at 11,250
  • Resistance at 12,270
Weekly Market Brief: Forecasts For The FTSE, DAX, NASDAQ 100, S&P 500 And Dow
 

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Weekly Market Brief: Forecasts For The FTSE, DAX, NASDAQ 100, S&P 500 And Dow

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