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| International Equity Index Daily Hotline 24 August 2010 By Cornelia Dichio, Analyst |
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The Nikkei 225 had shown some evidence of a loss of downtrend momentum over the summer months, seemingly building support above 9,000.
This morning's action sees this support give way with an evident reassertion of the 5-month downtrend.
Major lows for the index lie around 8,000, so longer-term investors who subscribe to the 2003/2008 double-bottom theory may not be unduly worried.
However, shorter-term the index is a sell and we open a position in the model portfolio accordingly.
The S&P500 has posted a dead cross on our scanner (50 and 200 day EMA). This is a fairly major negative for this important index although in the current choppy and directionless environment it is possible that we may see this MA pair switch backwards and forwards a few times untill some direction is established.
Here is the view on this instrument from Tarquin Coe, II's US equity analyst:
"On Friday the S&P 500 closed one point beneath the head and shoulders neckline we discussed that day. This morning saw a brief pop above the neckline and trading has since dropped back to it. The neckline, running through 1073/4 today, presents an important line-in-the-sand with respect to the indexes direction over the next week or two. To maintain the near-term bearish case, the index has no business closing several points above it on an end-of-day basis. "
Tarquin has established a short for the model portfolio in The Coe Report, and we follow suit.
Meanwhile, the going remains good in selected emerging markets. Our scanners are throwing out new all-time highs (for the week) on the Indonesia Jakarta Comp, the Chile General and the Sri Lankan All Share. See the website for charts.
In Asia the China Shanghai A shares have yet to reassert upwards from the base. Howevere, the "B" shares (see right) appear to have made a dramatic move, although intraday action appears to have been capped by the resistance above 260.
| Symbol | Stock | Close | % Change | Volume |
| SHBSHR | China Shanghai B Index | 254.779 | +5.1% | 46.0m |
| INDI25 | FTSE JSE Africa Industrial 25 Index | 22790.3 | +1.7% | 58.7m |
| RIGSE | Latvia OMX Riga Index | 412.728 | +1.4% | 25,131 |
| IBEX | Spain IBEX 35 Index | 10221.2 | +1.3% | 133.3m |
| UKX | FTSE 100 | 5234.84 | +0.8% | 582.3m |
| Symbol | Stock | Close | % Change | Volume |
| CHTX | Hungary Traded Index | 4516.31 | -3.6% | 1.7m |
| IBG | Argentina General Index | 132074 | -2.4% | 20.3m |
| PCOMP | Philippines Manila Comp Index | 3530.49 | -2.3% | 499.6m |
| KSE | Pakistan Karachi SE Index | 6762.7 | -1.4% | 50.8m |
| NKY | Japan Nikkei 225 Index | 8995.14 | -1.3% | 935.6m |
P&F Breakouts: Aug 23, 2010.
None Found
P&F breakouts identify medium-term trend changes. "Bull" breakouts occur when a stock reverses its downtrend by posting a "higher high". "Bear" breakouts are the inverse.
Key Day Reversals : August 23, 2010Code Name Signal Latest Close Change TSE2 Japan Topix 2nd Section Index Trough 2079.04 +19.17
Key day reversals are technical signals formed by stocks posting an "outside day" of a higher high and a lower close. Sells/Peaks occur on countertrend reversals from a bullish trend and buys/Troughs occur on countertrend reversals from bearish trends. Signals are particularly powerful when occurring after a period of overextension.
MA Crossovers : August 23, 2010Code Name Signal Latest Close Change SPX S&P 500 Index Dead 1067.36 -4.33
Moving Average (MA) crossovers identify longer-term changes of trend. We scan for "Golden" (bullish) and "Dead" (bearish) signals occurring when an instrument’s 50-day MA crosses its 200-day MA.
| Date | Stock | Code | Type | Open Price | Current Price | % P&L | Stop | Comment |
| 25 May 2010 | OEX Volatility Index | VIX | Long | 40 | 25.66 | -35.85% | ||
| 23 Jul 2010 | India BSE Sensex Index | SENSEX | Long | 18131 | 18311.6 | +1.00% | 17700 | |
| 2 Aug 2010 | Euro Stoxx 50 Index | SX5E | Long | 2822.17 | 2660.84 | -5.72% | 2675 | |
| 4 Aug 2010 | Czech Rep. Prague Stock Exchange Index | PX | Long | 1205.9 | 1180.1 | -2.14% | 1160 | |
| 5 Aug 2010 | France CAC40 Index | CAC | Long | 3799.15 | 3553.23 | -6.47% | 3575 | |
| 5 Aug 2010 | Germany DAX Index | DAX | Long | 6365.74 | 6010.91 | -5.57% | 6000 | |
| 5 Aug 2010 | FTSE 100 | UKX | Long | 5409.02 | 5234.84 | -3.22% | 5200 |
Our model portfolio is overly long in the current range-trading and indecisive environmment. Stops are now triggered in the CAC40 and the EuroSTOXX 50, reducing our overall exposure.
| Symbol | Name | Comment | Close | 1 day | Support | Resistance |
| SPGLOB | S&P Global 1200 Index | Sharp drop back to the base. | 1228.6 | -0.2% | 1220.97 | 1355.86/1301.25 |
| INDU | DJ Industrials | Breaks uptrend support at the late-July low. | 10174.4 | -0.4% | 10000 | 10920/10720 |
| SPX | S&P 500 Index | Finds resistance at the June high. Breaks late-July support. | 1067.36 | -0.4% | 1056.8 | 1173.57/1131 |
| CCMP | NASDAQ Comp. | Finds intraday support at the mid-July low. | 2159.63 | -0.9% | 21659.95 | 2341/2307.6 |
| NDX | NASDAQ 100 | Falls to 1807.46, where intraday support arrives. | 1808.31 | -1.0% | 178.55 | 1939.77/1919 |
| UKX | FTSE 100 | Finds resistance near the mid-May high. Dips under initial support. | 5234.84 | +0.8% | 5091 | 5435.99/5411.45 |
| SX5E | Euro Stoxx 50 | Falls back to the upper side of the base. | 2660.84 | +0.6% | 2586.5 | 2962.94/2850.5 |
| CAC | France CAC40 Index | Did not maintain the intraday dip under late-July support (near the upper side of the base). | 3553.23 | +0.8% | 3419.8 | 3857.64 |
| DAX | Germany DAX Index | 'Peak' KDR high forces valuations lower. | 6010.91 | +0.1% | 5906/6059.19 | 6626.7/6386.97 |
| SPMIB | Italy S&P MIB Index | Falls back into the base. | 20010.3 | +0.7% | 19644 | 21956.6/21633 |
| IBEX | Spain IBEX 35 Index | Finds resistance at the Mar/Apr trading band. | 10221.2 | +1.3% | 9805 | 11093/10953 |
| OMX | Sweden OMX Index | Unable to maintain the new high. | 1021.78 | +0.1% | 1016.5 | 1136.58/1084 |
| SMI | Switzerland SMI Index | Bull trap over the July high. | 6209.45 | +0.4% | 6067/6162.13 | 6535/6410 |
| AS51 | Australia ASX200 Index | Steadies near mid-July support. | 4381.3 | -1.1% | 4345.2 | 4622 |
| HSI | HK Hang Seng Index | Corrects from overbought, finding resistance beneath the Apr peak. | 20658.7 | -1.1% | 20008/21000? | 22389/21806 |
| NKY | Japan Nikkei 225 Index | Did not maintain the intraday break under the July floor (9091.7). | 8995.14 | -1.3% | 9065.64? | 10252/9807.36 |
| SHASHR | China Shanghai A Index | Upward dynamics suggest technical improvement. | 2776.85 | +0.4% | 2503.76 | 2817.47 |
| SENSEX | India BSE Sensex Index | Reasserts the uptrend, finding support above the 50-day MA. | 18311.6 | -0.5% | 17839/17915 | 18895.3 |
| CRTX | Russian Traded Index | Dips under sideways trading near 2100. | 2008.02 | -1.3% | 1972 | 2353.9/2206.57 |
| IBOV | Brazil Bovespa Index | Reasserting upwards from prior resistance at 66000. | 65981.9 | -1.0% | 66000 | 69810/68754 |
| VIX | OEX Volatility Index | Tests mid-July resistance. | 25.66 | +0.7% | 18.44/21.36 | 37.58/28.16 |
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