Breaking News
Investing Pro 0
New Year’s SALE: Up to 40% OFF InvestingPro+ CLAIM OFFER

Weekly Market Brief: FTSE, DAX, Nasdaq 100, S&P 500 And Dow

By Francesco BergaminiMarket OverviewDec 03, 2022 11:01AM ET
www.investing.com/analysis/weekly-market-brief-ftse-dax-nasdaq-100-sp-500-and-dow-200633080
Weekly Market Brief: FTSE, DAX, Nasdaq 100, S&P 500 And Dow
By Francesco Bergamini   |  Dec 03, 2022 11:01AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
 
NDX
+0.96%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
UK100
+0.05%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
US500
+0.25%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
DJI
+0.08%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
DE40
+0.11%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
IT40
+1.12%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

FTSE 100 (UKX)

The FTSE 100 index had a week up by +0.93%. For the week ahead, we favor a retracement in the area of 7,400.

Indicators

A positive week for the British index sees the price keep moving close to the strong level already reached in August. Despite a further positive week, we believe that the risk/reward on the UKX is now heavily unbalanced in favor of the short-medium term downside.

Daily chart: FTSE 100
Daily chart: FTSE 100

We believe that there are two important factors to support this thesis: the first is the price action. We can see that throughout 2022 the FTSE 100 has fluctuated on a wide lateral channel between 7,000 - 7,600.

The second aspect is internal indicators: MACD and RSI are now significantly extended to the upside, with the first seeing a slowdown in histograms, and the RSI remains in overbought territory.

Combining price action and internal indicators, we can see that the British index has more often fluctuated downwards rather than upward at current levels. The first sign of reversal, we believe, will come from the breaking of the 9-day moving average (red line), which has supported the price from mid-October till today.

We are bearish on the FTSE 100 and awaiting substantial drawdowns before considering long setups.

  • Support at 7,150
  • Resistance at 7,600

FTSE MIB

The FTSE MIB index had a week down by -0.39%. For the coming week, we favor a retracement of 23,700-23,500.

Indicators

Consolidation week for the FTSE MIB as it continues to move near the strong area of 24,850. After the strong stretches of previous weeks, the index is now stuck in a side channel: a break that will lead to strong volatility.

Daily chart: FTSEMIB
Daily chart: FTSEMIB

MACD and RSI keep being extended upwards, particularly the second in overbought territory (a scenario that has not happened since November 2021, followed by strong moves downwards). A further element of caution is the negative divergence between RSI and price.

The index is far from all major moving averages making the contour scenario unstable and subject to considerable reversals. We are bearish on the FTSEMIB as we believe that the overextension of both price and internal indicators shifted the weight in favor of possible pullbacks.

  • Support at 22,500
  • Resistance to 24,850

DAX 40 (DAX)

The DAX index had a week down by -0.08%. For the week to come, we are in favor of a progressive retracement to 13,900.

Indicators

Positive week for the German index that keeps the price close to the resistance level at 14,550, respecting the horizontal channel from February-March 2022.

Daily chart: DAX
Daily chart: DAX

MACD and RSI continue to be extended upwards, with the second in the overbought area: in both indicators, we notice a negative divergence with the price action.

Looking at previous swings, a pullback shortly followed once the price reached today's MACD and RSI levels. We believe that this situation is no different from the previous ones.

To allow the price to rise, the internal indicators should first retrace. We identify a possible retracement area around 13,600, without excluding a stronger pullback till 13,100.

We are bearish on the DAX and in favor of possible short-term reversals.

  • Support at 13,100
  • Resistance at 14,550

S&P 500

The S&P 500 index had a week up by +1.13%. For the coming week, we are in favor of a possible consolidation in the area of 4,000 - 3,900.

Indicators

Week that saw the SPX close slightly above the long bearish trendline in place since early 2022. The 9-day moving average (red line) continues to play the role of dynamic support.

Daily chart: S&P500
Daily chart: S&P500

MACD and RSI are extended upwards, particularly the first in a considerable slowdown. Although they are not in overbought territory, we are skeptical about the possibility of further upside potential.

We are neutral on the S&P 500: the contour scenario remains that of a bear market, and before we can change course, the obstacles are the overcoming of 4.100 and then 4,300.

We do not believe there is the strength to make extensions of this magnitude. Therefore, we prefer to wait for market reversals and retracement of internal indicators.

  • Support for 3,750
  • Resistance at 4.100

NASDAQ 100 (NDX)

The Nasdaq 100 index had a week up by +2.03%. For the coming week, we favor consolidation of 11,700 - 12,200.

Indicators

Positive week for the Tech index that now sees the price getting closer to the long bearish trend line that started in January 2022. MACD and RSI are positive and seem to support the index's advance.

Daily chart: NASDAQ
Daily chart: NASDAQ

The price stays above the 50-day average (yellow line), which we believe is an excellent medium to long-term indicator.

We are positive on the Nasdaq. At the same time, the strong downward extension of US rates to 10 years (now at 3.488%) makes us remain cautious about the index, as a recovery of vigor in the US10 could bring downward pressure on the index.

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

Dow Jones (DJI)

The Dow Jones index had a week up +0.24%. For the coming week, we favor an initial retracement of 33,600.

Indicators

Week that keeps the index at the August 2022 levels’. MACD and RSI are now very extended upwards, with the second in the overbought territory: the particular slowdown in histograms, we believe, is a further element of caution.

Daily chart: DOW JONES
Daily chart: DOW JONES

As in the past, the distance from the 50MA (yellow line) makes us cautious about the last strong upward extensions. We believe there is a fair chance of a retracement at least close to the 50-day average, or around 31,500 - 32,000.

We are bearish on the Dow Jones, given the strong upward move. We prefer to look forward to a slowdown in internal indicators, reconciliation with major moving averages, and a better relationship with volumes.

  • Support for 31,200
  • Resistance at 34,500 
Weekly Market Brief: FTSE, DAX, Nasdaq 100, S&P 500 And Dow
 

Related Articles

Weekly Market Brief: FTSE, DAX, Nasdaq 100, S&P 500 And Dow

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email