Equities surge again

Intermediate
  • A surge higher in global equity averages on Friday 15th February, dismissing the significant corrective setback seen on Thursday (after poor US Retails Sales data and concerns regarding the progress of US-Sino trade talks).
  • The recovery Friday was driven by a more upbeat assessment of the trade negations from both sides and a short-covering squeeze as notable technical levels from Thursday were easily overcome.
  • Here we look at the European and US benchmark averages, the DJ Euro STOXX 50 and S&P 500.

 

DJ Euro STOXX 50 bull trend reenergised

A surge higher Friday through key swing highs at 3225 and 3243 to a new 2019 high and a bullish outside daily pattern, to fully reject Thursday’s notable corrective setback (as we had expected), restoring both short- and intermediate-term bull trends, keeping risks higher Monday.

The mid-January surge above 3105 set an intermediate-term bull theme.

For Today:

  • We see an upside bias through 3276 for 3257 and then 3264, maybe 3277.
  • But below 3222 opens risk down to 3202/00 which we would look to hold. Below aims for 3172.

Intermediate-term Outlook – Upside Risks: We see an upside risk for 3257.

  • Higher targets would be 3306 and 3429.
  • What Changes This? Below 3025/22 shifts the outlook back to neutral; through 2931 is needed for a bear theme.

 

4 Hour Chart

DJEuroSTOXX50

 

S&P 500 E-Mini bull trend fully intact

A very strong rally Friday through 2763.0/63.75 resistances and again to another new 2019 high this morning above 2779/80 barriers, to reject Thursday’s corrective setback, resuming both short- and intermediate-term bullish forces, aiming higher for the US holiday session on Monday and on into Tuesday.

The late January above push above 2690.5 shifted the intermediate-term outlook to bullish.

For Today:

  • We see an upside bias through 2782.5; break here aims for 2792.75, maybe even towards 2800.0.
  • But below 2763/61 opens risk down to 2745.0, which would look to hold. Below targets 2729/26.

Intermediate-term Outlook – Upside Risks: We see an upside risk for 2819.0/31.25.

  • Higher targets would be 2953.25 and 2600.0
  • What Changes This? Below 2612.5 shifts the outlook back to neutral; through 2560.5 is needed for a bear theme.

 

4 Hour Chart

 SP500


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