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Stock market review (weekly) after 21st December, 2012.


Nothing happened to our planet and also for market. This week many indexes have faced mixed reaction due to news flows on negotiations to avoid US fiscal cliff and on the other hand BoJ’s asset purchase news was not much effective for stock indexes. Most of the leading indexes are seeing green numbers for 5th straight week. In the last day most stock indexes fell due to cancellation of vote for higher taxes in US, this issue may going to create further problems.

INDEX
21st December, 2012
12/14/2012-12/21/2012 (%)
12/7/2012-12/14/2012 (%)




Dow
13190.84
0.43
0.16
Ftse
5939.99
0.31
0.12
Cac
3661.4
0.49
1.04
Dax
7636.23
0.52
1.05
Australia S&P
4623.6
0.88
0.69
Shanghai Com.
2153.31
0.12
4.31
Hang Seng
22506.29
-0.44
1.87
Sensex
19242
-0.39
-0.55
Russia :Titans
6314.43
1.29
2.14
Bovespa
61007.03
2.35
1.91
Argentina: Merval
2786.4
3.32
8.75
South Africa
39124.58
1.16
1.25


Most investors have started to believe that stock indexes are not going to fall in a big way. In my past week review I was talking that Gold (comex) may cross $1680 range though it cross that level but in last few days it is getting support at $1640 so it looks like that Gold is showing adverse moves with equity market. On the other hand 10-year and 30-year US Treasury bond yields were also supporting the moves in the equity market.



Stock Market forecast for the coming week.

This week it is a brief market forecast.

Dow Jones I.A. has triggered its bullish pattern to some extent but it looks like that now it may be due to reacts on a very short-term bearish pattern. If that bearish pattern works out then Dow may test below around 13000 levels and I think Dow may give a signal of that in early days of the coming week. During last few weeks Dow is making higher highs and higher lows trend but this week its moves were not very supportive towards that trend so now emphasis should be given on around 13100 levels. Here I must say that if Dow breaks that trend and goes below 13000 support ranges then it has the option of testing further lower levels to prove the bearish pattern which I talked in past weeks. I want talk about the bearish pattern when Dow will go towards 12600 ranges.
On the other hand if Dow maintains 13100 in short-term and 12500-12600 support ranges for medium term then there is a good probability that Dow may make bullish patterns.


German DAX has shown quite better moves than many of its peers but now it looks like that Dax is getting some kind of resistance at around 7670-7680 levels. I think that if Dax is able to maintain around 7550 ranges in early to middle days of the coming week then it will again try to test around 7680 ranges.
Dax has good support at around 7400-7450 ranges and even if it drops around that ranges Dax has good chance to bounce again and test 7600 range. I will think about a future bearish pattern when Dax will drop below 7400 range but for that it has to test around 7000 which is far for now.


During last couple of months FTSE 100 failed to break around 5950 ranges, in my earlier posting I told that this time Ftse looks stronger but yet it failed to break around 5950 ranges. So hopes will be more in coming weeks, especially when its last day’s close was far better than its low.
I have a feeling that Ftse may be trying to make a very short-term bearish pattern but this type of pattern has less chance to trigger. In spite of that if that pattern works out then Ftse may test 5850 range in coming week. So long it maintains around 5800-5850 ranges, it has good chance to test 5950 range again. In the downside 5750 level is a good support for Ftse. Here I must say that now 5900 is the initial support for Ftse, so things can turn even from this range.


South Korean KOSPI reacted on its bullish pattern which I talked in past weeks. Now in coming future if kospi breaks this 2000 level then that may create a good opportunity to set a new trend because in that case Kospi will give strength to its medium and long-term bullish patterns. But for coming week it will be better to wait for full confirmation.
On the other side unless Kospi is breaking its past highs of Sept-Oct, I will not say that it is out of the bearish pattern but even if Kospi breaks that it has the option in the downside. I will talk about the bearish options when Kospi will be going towards levels around 1860 ranges.
Though Kopsi dropped in the last day but still it may reverse and try to break around 2000 levels but for that it has to maintain 1960-1980 ranges in early to middle days of the coming week. In fact 1960 is a very good support in the downside for Kospi, if it breaks that then 1940 will be the next support level.


In my past posting I was doubtful about the short-term bullish pattern of S&P/ASX 200 but it is good to see that it has finally triggered that. S&P/ASX is showing uptrend from middle of November but that not means that it is going to correct heavily in coming days. In the last day its close may create doubts but still I will be waiting for confirmations. After a long time S&P/ASX is trying to break 4600 levels and technical indicators are not showing too much over-bought position so it may still run in the upside provided it does not drop below 4550 in early to middle days of the coming week.
In past I was talking about future bearish option, since S&P/ASX crosses 4600 so it is out of that particular bearish pattern but still it may create another option and for that it has to test mores or less same level of around 4350. In the downside S&P/ASX has to face initial support at around 4500-4550 ranges. I have a feeling that unless a big correction comes, S&P/ASX will try to stay above 4500 ranges. It is more expected that S&P/ASX will be limited in between 4550-4650 ranges.



Reports due in coming days (from US) 

Wednesday, 26th December, 2012 – Home Prices Index

Thursday, 27th December, 2012 – Unemployment claims, New Home Sales, Consumer Confidence.

Friday, 28th December, 2012 – Pending Home Sales


Others

Thursday, 27th December, 2012 – Industrial Production and Retail Sale of Japan.



NOTE Please see the disclaimer of this blog.

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