Weekly Technical Outlook on Major Stock Indices 02 Apr to 06 Apr 2018

S&P 500 – 2585 remains the support to watch for a potential push up within range configuration

Key Levels (1 to 3 weeks)

Intermediate support: 2617

Pivot (key support): 2585

Resistances: 2690 & 2740/50

Support: 2540/30 (long-term pivot)

Medium-term (1 to 3 weeks) Outlook

The decline seen in the U.S. SP 500 Index (proxy for the S&P 500 futures) at the start of last week had managed to hold at the 2600/2585 medium-term pivotal support (lower boundary of the “Symmetrical Triangle” range configuration in place since 06 Feb 2018 low). Click here for a recap on our previous weekly technical outlook.

No major changes on its key technical elements and we maintain the bullish bias within the “Symmetrical Triangle” range configuration. Therefore as long as the 2585 medium-term pivotal support holds, the Index is likely to stage another round of potential push to retest 2690 follow by the “Symmetrical Triangle” range resistance at 2740/50 before another round of potential choppy decline materialises within the range.

On the other hand, a break below 2585 should see a further decline to retest the 2540/30 major support zone.

Nikkei 225 – Watch the 21600 upside trigger level

Key Levels (1 to 3 weeks)

Intermediate support: 21300

Pivot (key support): 20800

Resistances: 21600 (trigger) & 22510

Next support: 20330

Medium-term (1 to 3 weeks) Outlook

The Japan 225 Index (proxy for the Nikkei 225 futures) had managed to outperform the rest of the major indices as it staged a rally of 6% from its 26 Mar low of 20330.

In today (02 Apr) Asian session, the Index has staged a push up to test the upper boundary of the “Descending Wedge” range configuration (a bullish reversal chart pattern that tends to form towards the end of a down trend) at 21600 before it pull-backed at the last hour of the Japanese cash stock market session.

We maintain the bullish bias with an adjusted key medium-term pivotal support now at 20800 and a break above 21600 is likely to reinforce the start of a potential bullish impulsive upleg sequence to target the next medium-term resistance at 22510.

However, failure to hold above 20800 should put the bulls on hold for another round of choppy decline to retest the 26 Mar 2018 low of 20330 (excess).

Hang Seng – Bullish consolidation phase remains in progress

Key Levels (1 to 3 weeks)

Pivot (key support): 30070/29800

Resistances: 31140 & 31800 (upside trigger)

Next support: 29070

Medium-term (1 to 3 weeks) Outlook

Last week, the Hong Kong 50 Index (proxy for Hang Seng Index futures) had staged another decline to retest the 30070 medium-term pivotal support (printed an intraday low of 29804 in the Asian session on 29 Mar before it recovered & closed back above 30070 in the U.S. session).

No change, we maintain the bullish bias and tolerate the excess. Therefore as long as the 30070/29800 key medium-term pivotal support holds, the Index is likely to see a potential push up to retest 31800. A daily close above 31800 is still required to trigger the start of a potential impulsive upleg motion to target the current all-time high area of 33430/530 in the first step.

On the flipside, a break below 30070 support should negate the bullish tone for a deeper slide to retest the 09 Feb 2018 major swing low area of 29070.

ASX 200 – Potential push up towards range resistance

Key Levels (1 to 3 weeks)

Pivot (key support): 5750

Resistances: 6030 & 6150

Next supports: 5660 (major) & 5500

Medium-term (1 to 3 weeks) Outlook

The Australia 200 Index (proxy for the ASX 200 futures) had managed to hold the 5750 medium-term pivotal support after a test on it last Thurs, 29 Mar before the Easter holidays.

No major changes on its key technical elements.  Thus as long as the 5750 medium-term pivotal support holds, the Index is likely to stage a further potential push up to test the 5910 intermediate resistance before the 6030 “Symmetrical Triangle” resistance.

Failure to hold above 5750 should see a further slide to retest the 5660 major support and only a daily close below 5660 is likely to open up scope for the start of a multi-month corrective down move to target the next support at 5500 in the first step (the former range resistance of 07 Oct/25 Nov 2016 & close to the 50% Fibonacci retracement of the up move from 10 Feb 2016 low to 09 Jan 2018 high).    

DAX – Further potential push up toward range resistance

Key Levels (1 to 3 weeks)

Intermediate support: 11980

Pivot (key support): 11900/800

Resistances: 12130 & 12500/750

Next support: 10800

Medium-term (1 to 3 weeks) Outlook

Last week, the Germany 30 Index (proxy for the DAX futures) had inched higher to record a gain of 3.7% from its 26 Mar low of 11703 and hit the intermediate resistance/target of 12130 (printed a high of 12164 on 29 Mar, U.S. session.

No major changes on its key technical elements. Therefore as long as the 11900/800 key pivotal support holds, the Index is likely to shape a further potential push up to target 12130 before the range resistance of 12500 /750 (neckline of the impending bullish “Double Bottom” configuration in place since 06 Feb 2018 low).

However, failure to hold above 11900/800 should invalidate the recovery scenario to open up scope a multi-month corrective down move to test the next support at 10800 in the first step.

Charts are from City Index Advantage TraderPro & eSignal