Weekly Brief: Forecasts For The FTSE, DAX, NASDAQ 100, S&P 500 And The Dow Jones
Francesco Bergamini | Jul 03, 2022 03:53PM ET
TheFTSE 100 ended the week down -0.56%. For the coming week, we could see a bullish recovery at least to the area of 7,300.
h2 Technical Outlook/h2A week that we could describe as a consolidation of the index after the June sell-off. From a short-term perspective, starting from Jun. 17, we can see higher highs and lows, which are certainly a positive signal but not sufficient to establish the end of the downward pressure.
MACD and RSI appear to support a recovery in strength, but both remain in negative/bearish territory. We are positive on the FTSE 100 and favor a recovery in strength at least up to the 7,400 area: this area coincides with the 50MA (yellow line), which could play the role of dynamic resistance.
- Support at 6,960
- Resistance at 7,300
The FTSE MIB had a week down by -3.56%. For the week ahead, we could see a gradual push to at least 22.500 - 23.000.
h2 Technical Outlook/h2The long support area at 21.000 - 21.500 continues to support the Italian index: this area was respected both at the end of 2021 and in March 2022.
The negative performance of the week just ended could create positive divergences between Technical Outlook and price, which are, in our opinion, positive in short to medium term.
The first target to be reached is undoubtedly the bearish trendline at 22.500, followed by a stretch at least up to the 50MA (yellow line) at 23.650.
MACD and RSI suggest an upside scenario as the first is close to an upward crossing of the moving averages and the second is in positive divergence with the price: the positioning of these indicators does not represent the new low reached in June, makes us rule out the positive divergences.
We remain positive on the FTSEMIB and believe that this downturn can lead to rapid short to medium-term gains.
- Support at 21.000
- Resistance at 23.650
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The DAX ended the week down by -2.33%. For the week ahead, we could see a bullish recovery to at least 13.600.
h2 Technical Outlook/h2The very short-term bearish channel continues, which, given the strong support area, could lead to a reversal to the upside.
The reversal candle on Friday almost seems to allude to short-medium term rises, but we believe it is appropriate to wait for the break of the 9MA(red line).
Once the short-term channel is broken, we believe that a reasonable first target is the 50MA (yellow line).
We believe MACD and RSI are both in slight positive divergence with the price: the first suggests an improvement in the histograms, and the second at a decreasing price, we have seen a substantially flat fluctuation.
We remain positive on the DAX40 and believe the index may soon reverse to the upside.
- Support at 12.600
- Resistance at 14.050
The S&P 500 had a week down by -2.21%. For the week ahead, we favor a bullish continuation to at least 4,000.
h2 Technical Outlook/h2The short to a medium-term scenario we believe remains unchanged. The strong recovery of two weeks ago saw the one just closed, reporting a slight retracement. Physiological retracement and, perhaps, helpful in avoiding overbought situations and excessive volatility in the market.
We believe the "trading range" between 3.740 and 4.000 will allow the SPX to consolidate and then be able to break up the 50MA (yellow line), which has played the role of dynamic resistance since January 2022.
MACD and RSI support the bullish push, with the former crossing its moving averages upwards and the latter very close to breaking the 50 (bullish) line. We remain positive on the S&P500 in short to medium term.
- Support at 3.740
- Resistance at 4.000
The NASDAQ ended the week down by -4.30%. For the week ahead, we favor a bullish recovery to at least 12.400.
h2 Technical Outlook/h2We believe the week ended may only be a retracement after the strong bullish price action of two weeks ago. The intermediate support identified at 11.600 appears to be holding, and we expect a resumption of vigor in the technology index for the coming week.
MACD and RSI are supporting the recovery: the former has crossed its respective moving averages upwards and is also signaling a positive divergence with the price. The second, RSI, has instead reached the threshold of 50 (bullish), which in the past played the role of resistance: after a slight consolidation, we believe this level can be exceeded.
However, it is important to point out that the trend is still downward. Only a gradual break of the 50MA (yellow line) could generate a change in trend. We remain positive on the NASDAQ100 in short to medium term.
- Support at 10.700
- Resistance at 12.400
Dow Jones Industrial Average had a week down -by 1.28%. For the week ahead, we favor a bullish continuation to the 33.000 area.
h2 Technical Outlook/h2As with other US peers, we believe the week just ended has played the role of retracement. In short to the medium-term scenario, we believe that the DJI is undergoing a “bottoming” phase that could lead to a reversal to the upside.
The fact that the 9MA (red line) is holding and playing the role of dynamic support, we believe, is an excellent indicator of a possible trend change. MACD and RSI are supporting the bullish recovery of the index, both recording higher lows.
It is important to note that the primary trend remains downward, and only a gradual break of the 50MA (yellow line) could lead to a possible change in trend.
We remain positive on DOW JONES from a short-medium term perspective.
- Support at 29,200
- Resistance 32,000
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