Continued upswing on equity markets Stock market OMX S30 (1338,12) turned back up again after Swedbank presented a strong quarterly report which improved the mood on the Swedish market early in the day. The foreign markets strengthened as the US opening approached. The OMXS30 broke though the 1320 level without any problems, which indicates that the index may be heading towards the 1360 level. As long as this level isn’t surpassed the technical view remains negative. If the index continues to show strength beyond this level we will change our strategy from selling on upturns in the market, to instead buy on dips. DAX 30 (8886,96 rose by 1,94 % and has thus reached earlier resistance levels. Most likely the market will continue to rise towards at least the 9000 level and it would not surprise us if the German index moves all the way up to 9150 – 9200. S&P 500 (1941,28) rose by 1,96 % on Tuesday which means that the American index now has recovered most of the earlier losses. The long trend is once again neutral and in a best case scenario the index may rise all the way up to 1970 – 1980 before the next short term downward recoil. OMX C20 CAP (763.19) closed up by 2.4 % Tuesday, thereby closing above the resistance zone of 750-751.46. This means that this rebound has more to go and can continue for a little longer. At the same time the index managed to close the gap created during the sharp fall around 759, which we pointed to as the first target. The next resistance level, though of less importance, is around 780 and the market should be able to reach this target. The real litmus test of the strength of the rebound is around 790, which the market should stay below, if our assumption of a resumption of the bear trend in the near future should stay intact. Important news that may affect the markets During the remainder of the week a majority of the major companies on the Swedish market will present their quarterly reports which should lead to a volatile and perhaps also decisive ending to the week. Technical levels OMXS30 Trend: Short term rising, medium term falling, long term falling. Support: 1250 - 1260 Resistance: 1360, 1380 DAX 30 Trend: Short term rising, medium term falling, long term falling. Support: 8500 - 8600 Resistance: 9400 S&P 500 Trend: Short term rising, medium term falling, long term neutral. Support: 1900 Resistance: 1980 OMX C20 CAP Trend: short term rising, medium term falling, long term falling. Support: 720, 750-751.46 Resistance: 780, 790 Index recommendation Our next position will be to go short on the OMXS30 at 1350 – 1355 with a stop-loss at 1362.
Posted on: Wed, 22 Oct 2014 08:16:25 +0000
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