On the daily chart Estoxx50 Index is getting a bit dangerous for Bulls. DMI, Slow Stoch, MACD all bearish, and most importantly Price has touched the uptrend and arrived to Kumo support. Tenkan/Kijun weak bearish, Chikou Span below Price candles too. However a trend exists until it clearly breaks, and until the trend is so strong bullish, we have to suppose that Bulls will try to do everything at this support level to protect it.
Looking at multiple time frames, we can see critical days are ahead of this mkt: both 4 Hrs and 1 Hr is bearish, the counter trend is still intact. Watch if 1 Hr stays above previous low and prints a weak Tenkan/Kijun bullish cross at least. Price action today and tomorrow on the lower time frames will be very important to see if the Index can bottom out and turn up again, but still Bulls really need to do a lot more from here to push price above 3260 resistance level to stay in the game for longer. Same is true for the Bears if they want to get in power. As I marked on the daily chart, it is not enough just to push Price below the Kumo. They also have to break the previus key support at 3140 to reverse the trend, otherwise the attempt will fail.
Comments
dib309mar
⋅
Tks for you comment...i'm flat and not like go short also if today was 60 point....
Kumowizard
⋅
Nope. What I really wanted to show here is that both sides need more. For both bulls and bears will be hard to keep the control, unless it penetrates the 3140 key support too. Then it will become a sell on spikes.
A-shot
⋅
even 3140 is hit...
Kumowizard
⋅
Closing is everything. I did a test trade here, long some Estoxx50 vs short SP500. I think US mkts should accelerate a bit on bearish move after opening, or tomorrow Europeans will correct up a bit, with US still being offered. Not a big trade idea, but maybe will work short term... hopefully... as now it is in loss :-). Just it is pretty similar to the two previous breaks of this index. Only Estoxx50 seemed to break the trends, but later the spread between the two mkts tightenned back again.
A-shot
⋅
Well recent moves are sharper and growth is stopping. E50 has done a nice up move so far this year, and today's massinve -2% aim makes me subject the further up trend even more. US futures are alrady close to -1% - that does not happen very often. And as always, once US declines, europe follows suit to some degree... so i dont expect US to rise straight away (even if it does, it does so midday and a small sellof in the last hour is the usual pattern) and by that time Europe closes...so i expect a close with -2%ish still... a dead cat bounce tomorrow is probable indeed...but lower lows and lower highs on the recent trend make me itch...
Kumowizard
⋅
I am not bullish for equities at all. I still have Put options in my book. But actually my biggest bearish trade now is long VIX July and Aug futures. I am also long gold and USD.
A-shot
⋅
Gold i agree. Bearish trade on VIX? Did you mean Bullish as Vix is silly low.
Kumowizard
⋅
I am long VIX as a general "bearish on equities and vol should go higher" idea, so yes, in terms of VIX position it is bullish :-)
A-shot
⋅
Well ...1h and 4 h already went pretty bad. Is the bullish case even in tact now?