Daily Forecast - 19 January 2016
Dax March contract
Dax has minor support at 9515/10 but below here targets 9470/67, the 9450/45. Further losses test last week's low at 9410, just above October lows at 9390. A break lower this week targets 9364/60 & the most important support of the day (& probably the week) at 9317/9301. This is the September/August double bottom low & the last line of defense for bulls now. A close below starts a new leg lower in the 9 month bear trend & targets 9230/20. If we continue lower look for 9130/20. JUST BE AWARE THAT WE THEN MEET VERY STRONG SUPPORT AT 9060/9050. More on this if we approach it during the week.
First resistance at 9585/90. A break above 9600 could then target 9695/99. Exit any longs here & try shorts then at 9755/60. Shorts need stops above 9800. On a break higher we could then target an excellent selling opportunity at 9880/90. Shorts need stops above 9930.
Eurostoxx March contract
EuroStoxx holding below 2918 targets 2900/2896 then 2880 & 2863. If we continue lower look for quite good support at 2848/44.
We are actually testing a 6 year trend line at 2905/00. I don't have a huge amount of confidence in this after we broke more important levels last week, but if we do manage a recovery in oversold conditions look for first target at 2939/40 then resistance at 2962/67. A good chance of a high for the day but if we continue higher look for a selling opportunity at 2993/97. Shorts need stops above 3008.
Ftse March contract
FTSE has been trading in a bear channel since mid November/early December. The lower trend line from 16 November is at 5680 & obviously this held perfectly on Friday. In fact on the short term we even posted a positive candle on the bounce. This gives us 2 short term positive signals in oversold conditions. We must hold above 5745/48 today to try to build a recovery & retarget resistance at 5782/87. If we continue higher look for stronger resistance at 5818/22. Watch for a high for the day but further gains offer an excellent selling opportunity at 5850/60. Shorts need stops above 5880.
Below 5740 however could target 5715/10. If we fall further, it could be worth trying longs at 5690/80 with stops below 5665. However be ready to sell a break below here to target strong support at 5615/10. There is a very good chance of a bounce from here but longs need stops below 5590.
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