Stoxx50
Spanish politicians reduce yield % of IBEX 35BME:IBC FX:ESP35 BME:IBC
Fear, unconfidence, uncertainly and anothers negative sentiment have come back?
Since 2016 we seeing a negative spread between Spanish index #Ibex35 and another European indexes like DY1! #Dax30 FX1! #EuroStoxx50 FY1! #Stoxx600
December 21st, 2015 starts the negative performance of the index (Starts RED BASELINE on daily chart), one day after the mixed results in that first elections.
Almost one year to elect a Mariano Rajoy as a president after many elections and hours to discuss to "nowhere" in parlament congress, finally October 29th 2016, Rajoy got the votes to have investiture.
On 14 June 2017, FIRST motion of no confidence in the government of Mariano Rajoy requested by Podemos after a string of corruption scandals, was defeated 170 to 82, with PSOE abstention.
Then came the Catalunian crisis on second semester of 2017 and STILL continues, with many former funtionaries in jail, anothers in exile like Carles Puigdemont former Catalunian's president of Generalitat.
Finally on 25 may 2018, SECOND motion of no confidence requested by main oppositions party (PSOE)... starts a new political crisis increasing the negative performance reaching maximun levels again...
Adittionaly, context may not help= Italy case, bonds, ECB politics, debt, euro weak...
www.bloomberg.com
www.bloomberg.com
STOXX 50 DAILY LONG 2618 Very good high probability setup for change in direction. Strong level of support. RSI oversold with divergence and last leg sign of a retracement. Bears couldn't break lower that lever last week. If Italian election ends well and Merkel do her job for Germany things might go pretty well.Relatively cheaper equities in EU makes me think 2018 EU may overperform US indices. Will see. Expecting appreciation further of the EUR. 2:1 RRR. DAX CAC BEL will tell the story. Good Luck
Is europe due to outperform american stocks for a while?Based on numerous conditions: CFTC euro dollar extreme values (long crowed), CFTC dollar index extreme values (short crowed), german bonds 2y/10y vs us 2y/10y bonds spreads, american and europe inflation divergences (5y5y swaps), quantitative tightening (america fed hikes) vs esasing (europe ECB bond purchase), trump fiscal dollar multinational repatriation (buying dollar and sell other currencies) ...
Euro Stoxx 50- Major breakout inevitable.Euro Stoxx 50- Major breakout inevitable. Symmetrical triangle formation breakout will be violent. 50/50 chance of either bullish or bearish breakout.
The New EraThe chart above highlights the change in correlation between the STOXX50 and the S&P500 over the last decade. Interestingly there have been considerable falls in the correlation coefficient in 2012 and 2018. Are we in a new era where global markets are detached? Trading Forex / CFDs is High Risk.
ESA: Potential CD leg forming for +9% This is further to my earlier post on ESA: Make or break it. Since then the ESA has broken down from the continuation wedge and appears to have found support on the 200-DMA which coincides with a 78.6% retracement. Given the heavy data dump coming out this week and the US heading in earnings season, I would play it on the safe side to close shorts and look for spec longs. My view is also colored by the fact that the Stoxx 50 and Stoxx 600 are also sitting on trend line support as with some of the major tech names which I have highlighted as potential shorts.
The 1Q data dump and earnings should be relatively strong given the underlying economy is doing well and the recent protectionist actions taken by the Donald will take time to flow through the hard data. Do note, this is a tactical call. The overall set-up is still negative as previously mentioned, the mismanagement from the Donald WILL eventually flow into the data and of course, an xABCD pattern which I am describing here is a reversal pattern.
SX5E: Potential downside to 3100The SX5E is a much narrower index relative to the Stoxx 600 (check out my earlier post) but you get the same bearish conclusion. The SX5E is constrained by a major downtrend line marked by the 2007 and 2015 market tops, it is building somewhat of a expanding megaphone pattern over the last year and a massive MACD divergence from the price action. The last major down swing in Europe lasted for 1 year and I would imagine this down swing to be no different. This year is turning out to be a real dog.
STOXX 50! GOING LONG?!Going long on ''STOXX 50''
If prices break through our key level at 3475.0, we could see a bullish run up to highs of 3575.0/3625.0.
A solid break through our key level, will indicate to me that our targets aren't far-fetched and actually could be attained. Also we could get an opportunity to short this for the equivalent appreciation, which is really good!
Stoxx 50 / SX5E - Short Long Term - Up to 1000 Pips OpportunitySX5E seems to not be able to get into a reversal phase yet. If the current support does not hold, we can expect it to fall further below.
However, if the support holds firmly, then the opportunity is lost.
I will keep an eye on it as it does seem to be weak at the moment and open a position at the right time.
Expect to keep it open for at least a week.
Happy trading!
EURO STOXX 50. Sell on breakdown. Target 2655This could be a large WXY flat correction.
We are in the last Y wave down.
It could be a hefty gain.
Target at 2655 level is the minimum.
I like European indexes clean charts and ideal touch points as you could see in the EURO Stoxx 50 here.
STOXX50 - SELL ContinuaI am expecting and ABC correction on the EURO STOXX 50 to complete the C leg.
LIKE and FOLLOW for updates
Happy Trading (*_*)
STOXX50 longLook for bullish evidence and long-> move to breakeven as soon as possible.
In the past 13 years, every time when the mkt move below ema from an uptend, the chance of going up is 5/6.
Stoxx50 – Bearish break inside larger falling trendA corrective rally inside a larger descending trend line has officially ended yesterday, given the bearish break from a smaller rising channel seen on the daily chart (on left hand side).
The daily MACD has turned bearish as well, suggesting the upticks are likely to find fresh sellers.
The downside towards 2900 stands exposed and the bearish invalidation is seen only if the index ends the day above 3K levels.
Longer ViewTrading is not gambling. Gotta have long and short views at the same time. L'histoire se repete. From this principle, it's always good to think that crude and gold used to be cheap. Even with inflation/GDP-growth adjustments, market values sometime can still make no sense.
However, Barrick Gold once made a press announcement that production price for gold is around 940-980 USD in September 2015 just when trading around 1080 level, then around the same time Soros long on Barrick and Deutsche raised its rating to outperform.
While for oil, some economists argued that 10% drop can stimulate 0.1-0.5% economic growth. But apparently, oil price gotten too low will just increase default probability of oil companies with large contribution to the economy (e.g. employment) and raising deflation risk.
Sudden bullish moves on both gold (as classic volatility indicator before the VIX) and crude can remind of pre-2008 crisis. But what if this is just plain market mechanism, a simple under-valued adjustment?
Too bullish is not good, but neither is too bearish. I would rather use both fundamentals and technical in my trading strategy, one for short view and the other for the long view.
Anyway, have a great weekend!
The irrational marketNews:
www.bloomberg.com
There is a clear relationship between oil and prices. As the main source of energy in production activity, an increase in oil can lead to a lower consumer prices, thus, deflation. With central banks mandates to adjust interest rates to inflation level and expectation that the rate will go up when there's inflation, correlation with oil prices suddenly became higher lately and it impacted the stock market too. As lower interest rate means that bonds with lower variance will gets higher prices and investors will switch their investment from stock to fixed income market.
Currently, we are in earning seasons. But with lower price expectation, companies now faced two-sided pressures: lowering finished good prices and the inelastic production costs, especially from employee salary. Being squeezed, valuation analysts have to recheck their valuations with the latest oil development and it's very likely many stocks were overvalued
As some of you noticed, IMF cut its forecast on the same day of the oil bull run last week. But the market didn't pay attention to it. It is on the edge and try to get a grip on anything they can, even the false news published that Russia and Saudi had cut a deal. Even if they had, it's not stopping production, but keeping the production capacity as it is.
Market has always been irrational most of the time and that's how there's arbitrage. As front-month future price has breached it's BB-Band top-line (20 days, 4 std dev) and OVX (oil volatility index) started to increase, I would go short at this moment on market on general. I confirmed the same pattern on SPX/VIX and STOXX50/VSTOXX. And I also spotted quite the same thing for CBOE 10Y swap rate/SWVIX as well (www.cboe.com).
Good luck and godspeed next week!
STOXX50 / VSTOXXVSTOXX (Stoxx50 volatility index) is currently flirting with 4 months low level. STOXX 50 already started by touching top line of Bollinger band (20 days, 2 std dev). Comparing with S&P 500 and VIX (SP500 volatility index), we would also see +/- the same thing. Just be ready next week. Expecting at least 3% correction on STOXX50 in one of the days next week, as already quite clear with Saudi and Iran news development.
S&P 500 vs EUROSTOXX 50 - LONG TERM TECHNICALThis is basic view of Supp/Resist analysis. It ignores fundamentals.
Euro stoxx 50 gooverextended in a sweeping downtrend to uptrend move, decent area of reaction, good for a quick daily trade
