Technical Tuesday - September 25, 2018

Cerundolo Investment Research    

Technical Tuesday Update  

Volume 2, Issue 32
September 25, 2018

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US Markets

  • The recent pullback in the Nasdaq Composite, Russell 2000 and MDY have once again held very well into areas of support on their recent pullbackSmall and mid caps remain our favored areas for the U.S. market.  The S&P 500 is pausing into an area of resistance but remains well above support in the 2850 area.


European Markets

  • Both the DAX and CAC have had sharp rallies from their respective MFU-2 area and are now close to areas of resistance.  Spain's IBEX remains very weak in its well defined downtrend.


Asian Markets

  • Japan’s Nikkei is very close to the retest of the 24500 area we have been looking for.  Upside momentum is gaining strength and we are on alert for a breakout which would lead to another significant leg higher.  The Hang Seng has rallied short-term from its MFU-2 target area.  Overall view remains cautious as we have not seen a waning of the negative monthly momentum.


Emerging Markets

  • China’s Shanghai Composite is bouncing from its initial target in the 2600 area.  The overall view remains cautious.  India’s Nifty 50 is down 6% from where we initiated a cautious view and there is potential for more weakness.  We would avoid adding long exposure right here.  The Kospi 100 has rallied into an area where we expect it to fail.


Commodity Markets

  • WTI Crude Oil remains on target for a move into the $75—$77 area.  Nat Gas have finally rallied above a key area where the odds are high for another leg up.  Heating Oil remains in a bullish trend and is very close to breaking out.


Currency Markets

  • Both the U.S. Dollar Index DXY and the EURO are both at important inflection points.  The GBP and Dollar Yen both have more upside from here.