Weekly Technical Outlook on Stock Indices Uptrending within a wall of worry

S&P 500 – Bullish break from range

click to enlarge charts

Key Levels (1 to 3 weeks)

Pivot (key support): 2940

Resistances: 3028 (all-time high) & 3055/70

Next support: 2820

Directional Bias (1 to 3 weeks)

The SP 500 Index (proxy for the S&P 500 futures) has broken above the 2941 upper limit/resistance of a 4-week range configuration in place since 06 Aug 2019 that has invalidated the preferred multi-week bearish bias (click here for a recap).

Flip to a bullish bias in any dips above 2940 key medium-term pivotal support for a further potential push up to retest the current all-time high of 3028 before targeting the next resistance at 3055/70 within a major bearish ‘Expanding Wedge” configuration in place since 26 Jan 2018.

On the other hand, a daily close below 2940 indicates a failure bullish breakout to see another round of choppy decline towards the 2820 support (lower boundary of an ascending range since 03 Jan 2019).

Key elements

The daily RSI oscillator has broken above a significant corresponding descending resistance that suggests a revival of medium-term upside momentum.
The next medium-term significant resistance stands at 3055/70 which is defined by the intersection of the (upper boundaries of the “Expanding Wedge” from 26 Jan 2018 & ascending range from 03 Jan 2019), the upper boundary of a minor ascending channel from 26 Aug 2019 and a Fibonacci expansion cluster.

Hang Seng – Breaking above 26700

click to enlarge charts

Key Levels (1 to 3 weeks)

Pivot (key support): 26290

Resistance: 28000

Next support: 24870/500

Directional Bias (1 to 3 weeks)

The Hong Kong 50 Index (proxy for Hang Seng Index futures) has started to stage an attempt to break above 26700 (the former 05 Jun 2019 medium-term swing low) with a positive observation seen in the daily RSI oscillator that has staged a bullish breakout from a corresponding descending resistance.

Flip to a bullish bias in any dips above the 26290 key medium-term pivotal support for a mean reversion rebound to target the next resistance at 28000. On the other hand, a daily close below 26290 revives the bearish tone for a push back down to retest the major range support of 24870/500.

Nikkei 225 – Further up move within an ascending range

click to enlarge charts

Key Levels (1 to 3 weeks)

Intermediate support: 21070

Pivot (key support): 20820

Resistances: 21850 & 22490

Next support: 19900

Directional Bias (1 to 3 weeks)

The Japan 225 Index (proxy for the Nikkei 225 futures) has staged a bullish break from a 4-week range configuration in place since 06 Aug 2019 that has invalidated the preferred bearish scenario as per highlighted in our previous report.

Flip to a bullish bias in any dips above 20820 key medium-term pivotal support for a further potential push up to target the next resistance at 21850 with a maximum limit set at 22490 (03 May 2019 swing high). On the other hand, a daily close below 20820 suggests a failure bullish breakout for a choppy decline to retest the range support at 19900.

ASX 200 – Further push up above 6530

click to enlarge charts

Key Levels (1 to 3 weeks)

Intermediate support: 6605

Pivot (key support): 6530

Resistance: 6760

Next support: 6355

Directional Bias (1 to 3 weeks)

The Australia 200 Index (proxy for the ASX 200 futures) has cleared above the upper limit of the neutrality range at 6530 and validated a further up move.

In addition, the daily RSI oscillator remains positive above the 50 level which indicates a revival of medium-term upside momentum. We turn bullish in any dips above the 6530 key medium-term pivotal support for a further potential push up to target the 6760 resistance in the first step.

On the other hand, a daily close below 6530 negates the bullish tone a slide back to retest 6355 (15 Aug 2019 swing low & close to the lower boundary of an “Expanding Wedge” from 27 Mar 2019 low).

DAX – Further push up above 11850

click to enlarge charts

Key Levels (1 to 3 weeks)

Intermediate support: 11750

Pivot (key support): 11850

Resistances: 12600 & 12800

Next support: 11300

Directional Bias (1 to 3 weeks)

The Germany 30 Index (proxy for the DAX futures) has staged a bullish breakout from a 4-week range configuration in place since 06 Aug 2019. In addition, the daily RSI oscillator has turned bullish above the 50 level which indicates that medium-term upside momentum has resurfaced.

We turn bullish in any dips above the 11850 key medium-term pivotal resistance for a further potential push up to target 12600 follow by 12800 next (upper limit of the “Expanding Wedge” & 76.4% Fibonacci retracement of the previous down move from 23 Jan high to 26 Dec 2018 low).

On the other hand, a daily close below 11850 negates the bullish tone for a slide back to retest the 11300 range support.

Charts are from City Index Advantage TraderPro

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.