EU50 trade ideas
EUROSTOXX 50: Ready As Well
If you watch diffrent stockmarkets you see that each of them shows a kind of consolidation pattern or ramp ready to move forward and to go higher.
If you see this trading idea and some more from tonight keep in mind that European Retail Investors are "short" for at least 75% to 80% each market.
If you add both together than the conclusion might be that this bull run isn´t over now and might continue until end of this year.
Time To Buy Europe. Now!
If you follow the trading ideas here you might see that the sentiment for Europe is changing dramaticaly, obviously.
In the following days i will up date this trading idea for the ES50 with more information about the huge amount of cash wich Investors definitely draw out of Europe from January to October 2016. The number i remember was above a record 600 B Euro until June 2016 but it will be mutch higher all over the yerar 2016 fore sure.
Expect that a part of this money will return to Europe in the following month. This will push the most Major European Stockmarkets to new record highs. If you watch the trading ideas published here in December 2016 by me you will see that the stockmarkets in Italy, France, Germany and the EuroSTOXX 50 all showing the same pattern (double bottom) and might start now a new major bull market ---> right now.
EUStoxx Roadmap Dec 2016Entering crunch time. Draghi has ECB meeting this week, so lets see. Could surprise
Is Europe-US relative value game reversing?Something has begun in last few days in Europe. Price action in Eurostoxx50 index has been really strong both outright and relative to SP500.
Stoxx50/SPX spread - weekly (left panel):
- Spread rallied quite a lot since June, crossed back above Kijun Sen. This was remarkable, as the value had been holding below Kijun Sen since July/2015! From the October top, we saw retracement slightly below Kijun Sen again.
Last week, before Italian referendum market still looked to continue bearish. But this week we have a remarkable signal! -> Price spikes back above Kijun, and Heikin-Ashi shows a clear reversal.
- Smoothed haDelta+ indicator confirms with a cross up. MACD shows a bearish failure and likely to continue up. EWO ticks higher too.
So far it is just a very early signal, but looks like the underperformance of Stoxx50 relative to SPX may come to an end as the spread could not make a lower low.
As a strategy I'd suggest buying Stoxx50 on dips vs selling SPX. You don't have to rush, probably there will be some dips before the Stoxx50 weekly chart confirms a bullish breakout.
In other words, if you don't trade the spread, but you look to buy equities, Europe can be a better opportunity, while on bearish side SPX has to be picked (if a sell signal confirms)
Stoxx50 - Weekly (right panel):
- Ichimoku is still neutral as price is located in the Kumo cloud, but watch out for forward Senkou B! The 52 weeks average has dropped to 3000, while Senkou A (average of Tenkan and Kijun) started to turn up. This makes some initial bullish bias in the thinner forward Kumo. Chikou Span is trying to cross above past candles too.
Tenkan/Kijun has been weak bullish since August, and all selling attempts were blocked by the weekly Kijun Sen.
The supports of this market are very clear now: 3000 / 2955 / 2900
- Heikin-Ashi signal is bullish, haDelta made a bullish cross above zero. EWO and MACD has initial bullish bias too. Until we get some more bullish confirmation, try to buy retracements to 3080 rather than rusing into longs here.
Not clear at all.Same indecision, with increasing volatilit (-> see ATR!)
Not trending, it is still just a choppy sideaway. Wait until clear signal comes!
Neutral ramge, mixed signalsWeekly:
- Ichimoku is abslutely neutral: Price is below Tenkan, above Kijun and shaded by a thick forward Kumo cloud. Tenkan/Kijun medium bullish. Chikou Span is at past candles.
- Wider range is 2900 - 3100, tighter range is 2930 - 3050.
- Heikin-Ashi has bearish bias, but haDelta and Oscillator are rather neutral
- EWO is neutral, MACD is neutral too.
Daily:
- Ichimoku is neutral: both spot and forward Kumo cloud is just a flat line: equilibrium is ard 3010-20, where all flat average lines stay together
- Tightenning triangle, with support around 2930 and resistance at 3080.
- Heikin-Ashi shows bearish momentum is off for today, but it is not yet bullish, just undecisive: long wicked doji candle with haDelta and DMO turning up, but both indicators are still below their zero lines!
- EWO is slightly bearish
If you know how to trade this market, good for you. I stay flat. It is ery annoying with too much noise.
Europe's Blue-Chips Look WeakAs tweeted earlier , the Euro Stoxx 50 chart is looking very weak. While near-term technicals dip into oversold territory, the projection is for price action to head lower.
Today's session saw a close underneath the post-Brexit uptrend, and we are likely to see a move to 2,900 to 2,915 -- or the 61 percent retracement from mid-December.
The momentum of the trend via ADX-DMI is showing strength and overwhelming bearish price action. Due to the oversold technicals, with the z-score at -1.87, a relief bounce is expected. (the weekly z-score is just -.18).
However, expect Europe's to challege the 61 percent Fib. A close below this level would cause trouble, and the index could see another 50-100 point decline to challenge the larger downtrend support.
Additionally, the 20-day EMA is looking to cause a bearish crossover with the 200-day EMA.
Also, check out our excellent short call on Euro Stoxx 50 leading into the #Brexit vote !
If you want to learn more follow @Macro_View on TWTR -0.17% and go to macroview.co to get on our waiting list to subscribe!
Eurostoxx 50 : Bearish dynamic & resistance areas, better shortThe EU stocks index Eurostoxx 50 (MOY0) has made a nice rise since the Brexit (end June), but the buyers are currently facing some difficulties to go higher. In fact, the european stock market is inside a bearish dynamic since early 2015, as characterized by the downside trendline resistance (blue) and the bearish 200 days moving average.
In this case, the sellers are likely to become majoritary again due the the following reasons :
- Proximity with the downside trendline resistance
- Beginning of a retreat at 3100 points, first resistance
- This resistance area matches with the 50% retracement of the violent drop we have seen in december - february.
Both the long term dynamics and levels should prevent the buyers to go further and initiate a pull back to where markets were in september.
Here is the precise strategy :
- Open short at the current price (3080 points on Friday close)
- Stop @ 3120 pts (above the resistance for market noise)
- First target @ 3025 points (close 50% of the position, reward/risk = 1.38)
- Second target @ 2940 points (close the other 50% of the position, reward/risk = 3.5)
Short If Closes Below Trendline.If Closes below trend line, short entry to major trend line, then see if it can consolidate above it or break it .
Also Divergence.
Two possible views for EUROSTOXXWait breakout or bounce on level indicated. Trade when you're pretty confident about the trend and always following your trading strategy!
I think bearish possibility chance is much higher than bullish up to now.
GL
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.
Hold short until mkt trades below 30504H setup is neutral with bearish bias.
- Market could not push back above Kijun Sen 3041+
- forward Kumo is flat now, may deliver a bearish cross.
- Heikin-Ashi shows indecision again -> doji-like candle, haDelta/SMA3 down.
- EWO is still bearish
I re-sold 0,5 unit this morning. Hold short with 3050 stop. I think we'll see a lower low around 2960.
How to deal with resistance zone?Weekly:
- Ichimoku setup is back to neutral
- The long term wide bearish channel is still active. Price got close to trendline (act. at 3125)
- Heikin-Ashi signal is swing bullish.
- MACD is counter bullish, as both the convergence line and signal line are below zero.
- 3095-3150 is a strong support/resistance zone, marked by trendline, Kumo (forward Senkou B) and 100wma
- EWO is neutral too. (ticks to green, but it did the same in November 2015)
Daily:
- Previous idea of possible small Head and Shoulders top did not work. Ichimoku setup is still bullish
- However we have warning signals too, which suggest the risk/reward and P/L upside of long positions from this point may be limited:
1. possible bearish wedge formation
2. Heikin-Ashi signals some exhaustion at 3095, lower level of resistance zone. Candles shrink, haDelta crosse down, today haOscillator crossed down as well
3. haOscillator also has some negative divergence compared to price action (price higher high vs haOscillator lower high)
4. EWO is bullish, but could not post a higher high, despite price moved above previous local high. For those who like wave counts, this suggest that the 5th Elliot wave is done, or will soon be done.
5. Volatility is extremely low. Looking at ATR (14, SMA), its value is stuck below 50 points.
I don't say we have a massive sell signal to go short in big. What I say is that at this level, and in the zone above Bulls will have hard time to push further up. This is not time to buy. Rather time to reduce exposure and take profit on longs.
Something else:
Market has just fallen in love with the idea of further ECB easing. Bond mkt prices another rate cut and announcement of more QE and QE extension. In fact this is something, which the EU Bank index(es) would hate at the maximum. ECB policy is completely killing banking business, if not puts the whole financial system to a huge risk of collapse! Guess what, STOXX50 is not the DAX! This index has more bank weight. What's more, it contains Spanish and Italian stocks. Do you read the news about Italy? Well, I would not be very comfortable to hold and exposure there (neither in S-Pain ;-) ) for the rest of 2016.
