08/01/2012

The Big picture now for the stock indexes


After the first week of 2012 one index has turned technically bullish and that is the DOW. There is only one thing that makes me hesitate about the Dow and that is the falling 8 months MA. On the other hand this index is now above its 200 MA which is rising and the 50 days MA has crossed the 200 MA on upside and is rising.
Much good news about the American economy came last week especially regarding the employment situation telling me that the US economy is slowly starting up. The US blue chips index is also looked upon as a safe haven when the dollar goes up and the Euro down. A good alternative to bonds. However the daily trend has been sideways the first week and there is a possibility of a drop if the Spanish and Italian bond auctions this coming week will be too bad.
SP500 is number two but not in a bull market technically. The daily and weekly trends are up but the monthly trend down.
FTSE, SWED and DAX are the best performing European indexes with daily and weekly trends up. The 2 hour trends however are down or sideways.
CAC, IBEX and MIB weekly, daily and 2 hour trends are all down.
There is no clear long term trend for any of the indexes yet. The EURO finished last week down at a new 16 months low just above 1.2678 which is a strong resistance point. I expect the Euro to continue down and there is a risk of a steep fall if the European crisis suddenly gets worse during the coming weeks.

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