What’s inside:
S&P 500
Most major global markets were cut short a day last week in observance of ‘Good Friday’ prior to Easter Sunday. In the week ahead, the economic calendar is quite light on ‘high’ impact events, with several ‘medium’ impact releases due out in the U.S. throughout the week.
U.S. markets ended last week on a negative note, closing at their worst levels of the holiday-shortened week. The S&P 500 broke the November trend-line on Wednesday after carving out a second lower high on the day the FOMC released its minutes from the March policy meeting. The next leg in this sequence of lower highs since the March record high, is for a lower low below last month’s low of 2322. The next level of support on a lower low may come in at the lower parallel around 2307. The next levels of price support comes in at 2301, and with aggressive selling we could see a move towards the 2270s. It will take some work from current levels to turn the picture positive.
S&P 500: Daily
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DAX
All economic data set to be released next week is of the ‘low’ to ‘medium’ impact variety, for full details visit the economic calendar.
Since very nearly touching off at the record high of 12391 set in 2015 the DAX has been in pullback mode, but if it doesn’t soon turn higher from trend support the pullback could turn into an outright bearish decline. Given the way U.S. equities are heading, an outright bearish decline is looking like a probable scenario.
The lines of support the DAX closed around last week are the trend-line rising up from the December low and the lower parallel extending higher off the early February low. They aren’t in exact alignment, but do offer a confluence zone from which the market should bounce if it is to maintain its clean trend structure over the past few months. If support can hold (thinking is, it won’t) the DAX will need to cross over a small swing-high at 12247 before momentum can kick in back towards the prior high at 12375 and record high of 12391. However, on a drop below support lines and the 4/11 low at 12050 the market could be in trouble. The next level of support on a breakdown clocks in at the March low of 11850, then 11722, and in the event we see a big swoon there isn’t anything significant until 11480.
