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Monday, December 05, 2016 10:12:34 AM
Italian and German Indexes Battle Different Sides of Key Moving Average $DAX $MIB
By Arthur Hill
* December 5, 2016
The chart below shows year-to-date price action for the Milan Index ($MIB) and German DAX Index ($DAX). Note that the MIB is down around 22% year-to-date and the DAX is down around 2% since January. In contrast, the S&P 500 is up around 6% so far this year. The next directional move for European stocks could hinge on these two indexes. The Milan Index is in a downtrend overall and just below the 200-day SMA. The highs extending back to August mark resistance in the 17000-17500 area and a breakout here is needed to reverse the downtrend. Such a move would be quite bullish for Italian stocks and this would also benefit Europe.
The bottom window shows the German Index trading above the 200-day SMA since late July. Notice how the DAX established support in the 10200 area with lows in September and November. The rising 200-day SMA is also in this zone. I am inclined to add a buffer and mark support in the 10000-10200 area. The overall trend is up as long as this zone holds. A break below 10000 would reverse this uptrend and be bearish for German stocks - and European stocks. Thus, we have two indexes representing two of the biggest economies in Europe. Both stalled since August and both have clear support/resistance zones to watch. Upside breaks in both would be bullish, while downside breaks in both would be bearish.
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Thanks for tuning in and have a great day!
--Arthur Hill CMT
http://stockcharts.com/articles/dont_ignore_this_chart/2016/12/italian-and-german-indexes-battle-different-sides-of-key-moving-average-dax-mib.html
• DiscoverGold
By Arthur Hill
* December 5, 2016
The chart below shows year-to-date price action for the Milan Index ($MIB) and German DAX Index ($DAX). Note that the MIB is down around 22% year-to-date and the DAX is down around 2% since January. In contrast, the S&P 500 is up around 6% so far this year. The next directional move for European stocks could hinge on these two indexes. The Milan Index is in a downtrend overall and just below the 200-day SMA. The highs extending back to August mark resistance in the 17000-17500 area and a breakout here is needed to reverse the downtrend. Such a move would be quite bullish for Italian stocks and this would also benefit Europe.
The bottom window shows the German Index trading above the 200-day SMA since late July. Notice how the DAX established support in the 10200 area with lows in September and November. The rising 200-day SMA is also in this zone. I am inclined to add a buffer and mark support in the 10000-10200 area. The overall trend is up as long as this zone holds. A break below 10000 would reverse this uptrend and be bearish for German stocks - and European stocks. Thus, we have two indexes representing two of the biggest economies in Europe. Both stalled since August and both have clear support/resistance zones to watch. Upside breaks in both would be bullish, while downside breaks in both would be bearish.
****************************************
Thanks for tuning in and have a great day!
--Arthur Hill CMT
http://stockcharts.com/articles/dont_ignore_this_chart/2016/12/italian-and-german-indexes-battle-different-sides-of-key-moving-average-dax-mib.html
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Information posted to this board is not meant to suggest any specific action, but to point out the technical signs that can help our readers make their own specific decisions. Your Due Dilegence is a must!
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