Let’s start immediately with a data: what happened this week is unprecedented in at least 25 years of stock exchange. From 1993 to today there are no precedents of a negative excursion of this type in an uptrend. There was a similar day in October 2008, with losses reaching over 18% a week but we were already in a bearish trend, all the indicators were downward and so it was more difficult to be taken by surprise.
Let’s look in detail at the situation of the main financial markets:
FTSEMIB: Last week we had written: “The descent could continue towards 22000 points but it would not decree the death of the bull”. A nice downturn happened and the Italian market has done better than the other markets and has settled on the decisive support given by: Ematrend indicator + uptrendline trendline + static support + mm200 periods. All pass in area 21700. It is reasonable to expect a rebound.
DAX30: last week we wrote: “here (and on Eurostoxx) the technical situation is worse than the Ftsemib. The double maximum at 13500, the 12900 yield, the super euro and the super oil have to light some alarm bells. decisive support”. The support sold off. Now I’m waiting for a pullback to the trendline that has yield and then it probably come down again.
S&P500: a reversal could be expected after the run up but a similar descent, as written, is unprecedented in a bull cycle. The US market recovered before the Friday closing saved it in corner. The trendline held up, the 200-period moving average as well. 2518 is the last bastion before the precipice. In the immediate it’s possible a rebound towards 2700.
BUND: “The break of 160 and the trendline in yellow (already a few weeks ago) could open bearish scenarios with the first target 155”. This was the comment of 4 February. It remains confirmed even if in the short there could be a retest of 159.
EUR DOLLAR: Here there were no surprises, we announced the descent and so it was. The euro should go sideways for a few weeks with a minimum of congestion at 1.21.
BITCOIN: Here, too, the second program last week, where the comment was: “The short trend is on the downside and could further strengthen with the break of the bullish trendline highlighted on the chart, but at 6700 it may return to be felt supports able to attract buyers “. The trend would reverse over 10000.