Index Strat Risk Target FTSE DAX CAC 40
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[U]FTSE 100 [/U][/B]
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Long-term Technical Outlook[/U][/B]
There is little change to the outlook for the FTSE 100. 5 waves down from the 2007 high are complete and A 3 wave advance is underway now. Short term structure is not clear (everything from the March low). Let the pattern play out and we’ll look to identify the end of the correction.
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Short-Term Technical Outlook
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The FTSE is once again testing support at a rising trend line that has guided the index higher since early March. A break lower would see support at the intersection of the 100-day moving average and the 61.8% Fibonacci retracement.
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[U]DAX 30
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Long-term Technical Outlook[/U][/B]
A 5 wave decline is also complete in the DAX. Short term structure is not clear (everything from the March low). Let the pattern play out and we’ll look to identify the end of the correction.
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Short-Term Technical Outlook[/U][/B]
German shares are seeing bullish momentum stall at double top resistance (47020). Initial support is seen at the intersection of the 76.4% Fibonacci retracement level and the lower boundary of a rising channel that has guided the DAX since early March.
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[U]CAC 40 _[/U][/B]
[B][U]Long-term Technical Outlook
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In examining the CAC 40 pattern from the 2007 high, it is possible to count 5 waves down with wave 5 as an ending diagonal. The diagonal is clear on this chart. 5th wave diagonals are almost always fully retraced fairly quickly. As is the case with other European indexes, near term structure is not clear.
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Short-Term Technical Outlook
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French issues have returned to test the bottom of a rising channel that has contained prices since early March. A break lower would see initial support at the 100-day moving average.
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[U]IBEX 35 _[/U][/B]
[B][U]Long-term Technical Outlook
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The rally from the low (6703) is viewed as corrective. Short term structure is not clear (everything from the March low). Let the pattern play out and we’ll look to identify the end of the correction.
[U][B]Short-Term Technical Outlook
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Spain’s benchmark index gapped below support at the lower boundary of a rising channel. From here, the bears face the next hurdle at the 100-day moving average. A break beyond that will aim for resistance-turned-support at 81065.
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[U]S&P/MIB INDEX [/U][/B]
[B][U]Long-term Technical Outlook[/U][/B]
It appears that the Milan index needs at least one more low prior to formation of a longer standing bottom. An impulse (5 waves) appears to be unfolding from the 2007 high. Wave 3 is complete at 12332. I wrote last week that “a wave 4 recovery could be large as initial Fibonacci resistance is not until 19543.” The index is closing in on Fibonacci resistance so beware of a top forming in the next few weeks. RSI is divergent at the recent top as well.
[U][B]Short-Term Technical Outlook
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The MIB Index looks to be confined in a narrow rising wedge, a pattern indicative of a bearish reversal up ahead. Negative divergence on the RSI oscillator bolsters the bearish bias. A break below the wedge’s lower boundary will see support at the 100-day moving average.