DAX and SPX Weekly Analyses, Nov 17, 2019

Sixth up week in a row for indices (seventh for NDX). Markets are focused on US-China trade relations, seeking any kind of decisive information, while US indices grinding higher, making new ATHs. Not all of them, since RUT is still lagging behind, with 1600 resistance intact.


In the week ahead:

Lite Economic calendar for first two days of the upcoming week, and then we have FOMC Meeting Minutes on Wednesday, and ECB Monetary Policy Meeting Accounts on Thursday.


Friday is unusually full with news releases, starting with ECB President Christine Lagarde speech, and then we will have French, German, EU and US Flash Manufacturing PMIs releases - and those data can move markets, at least short term.


Charts starts with US markets:


Chart #1 - ES_F Weekly


Sixt up week in a row. Third consecutive weekly close above prior resistance trendline. Price inside blue upsloping chanel, with upper line around 3130. Even a 100 point pullback now would be good enough to just retest previous ATH. That would be a pullback to 3025-30 area, and in case that happens, likely to be bought on the first test. Any bigger downside move requires decisive breakdown below that. Buyers are still dominant across the board.


Chart #2 - NQ Daily


Nasdaq 100 pushing above the upsloping trendline. Like ES_F, making higher lows. Still a possibility of retesting prev. ATH.


Chart #3 - RUT daily


Resistance at 1,600 is still intact. Lagging behind SPX and NDX for a year. Numerous tests of both lower and higher end of a range - where it is now building a bull-flag for 9 consecutive days. As written here before - catch up move for RUT to chase SPX/NDX could be epic, since 100% range expansion of this 1,450-1,600 range to the upside, would lead small cap index to test its own ATH.


US markets conclusion: Very resilient, buyers in control. We could get a pullback at any given time, since momentum is fading, volume is not so strong, but at the same time, we can expect that any kind of pullback will be bought, at least on a first test. Testing prev. ATHs on SPX and NDX would be constructive - and once and IF it happens, we will then monitor situation day by day.


Chart #4 - FDAX Daily


Known levels, and sequence of up - range - up - range. Classic bullish behaviour and a 1,500 points up leg, without a serious pullback. Let's observe this on another chart.


Chart #5 - DAX Cash Index Daily


Range 13,110-310 is in play for 9 consecutive days. Since there are no significant news releases until Wednesday, this range can contain price for a few more days.


DAX Conclusion: When we combine these two DAX charts, then we have all the index gaps and important levels in mind. Then we can make several conclusions and scenarios. Like - there is nothing much of resistance between 13,300 and ATH, IF market makes a breakout from current range. Also, that IF we have consecutive daily closes below 13,200 prior LTF level, that all of this range could be "look above and fail" above those May/June 2018 swing highs that are around 13,200. That even a down move all the way to 12,500 would not harm bigger picture bullish trend. That ONLY a decisive breakdown below 12,500 and below this trendlines from Chart #5, would be concerning for long term buy-and-holders. That any dip toward 13,000 - something that would be also a decent possibility, since this WAS NOT tested in RTH session after a breakout made in premarket session - would be bought on the first test, and the same goes for any other dip toward 12,800 / 12,650 / 12,500 levels.


For day traders: each and every day, we can find opportunities on both sides. Why a day trader and occasional swing trader like StrayDog even bother with LTF charts and analyses you may ask? Because ALL OF THIS is a part of a context we use every day. We must know who is in charge, what is the BIG picture, in which direction to not overstay... Something that is explained for DAX traders and Subscribers of DAILY DOSE OF DAX every day in Morning notes and in Recap videos / Weekly Review videos.


To know what can we expect in daytrading, to recognize simple day trading setups, like this ones below:


Chart #6 - RUT 30 min chart


Multiple day trading setups as first test of S/R zones, fading zones, trendline tests. All of them doable on a simple chart, without market profile, order flow, multiple screens. Don't get me wrong - I have nothing against all of that, just showing the "old school" classical trading that will NEVER die. All other forms are derived from this, from support and resistance, from supply and demand. And you can find these kind of examples EVERYWHERE, not just on indices, once you train your eyes.


I wish you all a pleasant weekend, and good trading.

Cheers, StrayDog