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Home » The Best Indices to Invest In? “Nasdaq in the US and DAX in Europe”

The Best Indices to Invest In? “Nasdaq in the US and DAX in Europe”

– How do you see the situation on Wall Street after the release of most of the financial statements for the first quarter of the year?

Let’s take a look at the leading index of world stocks, the S&P 500. The US index has entered a correction phase, the breadth of the markets has deteriorated, but this correction phase is moving sideways. Look, we got to about the 4190 area, then we had a correction to 4050, from there we’re pulling up and attacking the top of the lateral area. As we are already seeing here that the breadth of the market is starting to improve from now on, well confirmation, an ideal close above 4170-4171 gives us confirmation that the worst is over and that we can start from here return to more bullish tone at least more likely that we can continue higher with more clarity. Hence 4171 points and if it breaks through we would have to consider 4270 points as a possible target level. And later, well, the end-of-day max we have is 4300, so about 4303 on August 16, 2022. So the market can start to improve now, even if it’s improving like we are have seen, has not deteriorated, virtually nothing in the S&P 500 in the sideways range and on the other hand there was a correction phase in the NASDAQ that was not at all corrective. Quite the contrary, in fact the sideways range was clearly broken to the upside as it crossed the 13,190 zone, crossed it, later corrected and then pulled hard again. And now, in the case of the NASDAQ, we expect an attack at 13,651, the high for August 2022. Breaking this level would be very, very good news on a technical level as it already suggests the bearish divergence we had or in in this case a divergence with bullish implications would be triggered. Then we would already have 14,873 as the most likely scenario in the medium term. If we look at the Russell 2000, which in this case was the index, it has been the most affected by the entire financial crisis and given the doubts about the potential economic crisis that could be coming, in the case of the Russell 2000 we see major weakness would be the key in the first overcoming of 1,812.3 points. If we saw that, it would be very likely that Russell would be back around 1,889. So, in order of strength, we have the NASDAQ, then the S&P 500, and finally the Russell 2000, which is the weakest.

– Do you see anything better for the European equity markets?

In Europe we continue to see strength. Note that the EURO STOXX 50 is all about breaking the resistance. Well, it has not broken that phase of resistance, the 4400, but still it has broken the previous resistance which was at 4320 and this leads us to suggest that it is highly likely that it will eventually break through the 4400 points. And after this corrective phase that we have seen and after the support and the 50 average with rising technical indicators, they tell us that the European market is clearly still very strong. But hey, we’re going to benchmark against the S&P 500 to see if we actually have more or less strength than the North American market. We will make the comparison using the RSCMansfield, an indicator that allows us to see the relative strength. We compare this indicator to the S&P 500, which it believes leads the world stock markets, and now let’s see how the European market is performing at the moment. Looking at this, the relative performance of the EURO STOXX 50 in the European market is currently slightly underperforming that of the S&P 500. As such, the EURO STOXX 50 may be losing some strength versus the S&P in the near term. However, the same does not apply to the German Dax. If we look at the Dax, it is stronger than the S&P 500, and if we look very quickly at the S&P 500 book, we see that the relative strength is less. This means that we have the Dax in Europe as the strongest index to be taken into account. USA, NASDAQ and in Europe, DAX.

– The Ibex 35 has remained at around 9,200 points for a few days. What would you do in this situation?

Hold, no problem hold as we have seen that we continue to have a series of rising lows. The highs have stayed the same so a break of 9,526 would be a triangle break and therefore bullish implications. As long as the value does not fall below 8,900 points, there is no need to worry about the moment. We have a sideways range, yes, less strength than the Dax, even less strength than the EURO STOXX 50 and the S&P 500, but for now it’s holding up and the trend remains positive. So keep it.

– In this context, what values ​​do you see most interesting on the Ibex and outside the Spanish stock market?

We’re going to be discussing what’s strong, which we’ve been talking about for the past few weeks. Nothing has changed: ACS, Iberdrola, Aena, Amadeus, CIE Automotive, Ferrovial and Inditex are the strongest in the IBEX 35. If we go to the IBEX Medium Cap for example, we will see more obvious strength in stocks like CAF or Ebro Foods and on the IBEX Small Cap Metrovacesa or Tubacex. These are all stocks showing strength. That doesn’t mean we have to be in them now, we have to look for entry points, but have them on the radar to buy in times of corrections because they continue to show strength.

– Do you think it’s time to invest in gold?

Now it’s time to correct. When the market, and in this case, we see it no longer seeks active haven as much. In other words, if it’s possible to switch to riskier assets like variable income, doing so will hurt gold. We are seeing a loss of $1,963 an ounce and a daily close below this level could see the price rally back to $1,900. It would not change the trend as as long as it stays above $1,800 the trend would be higher. The trend is bullish but in the short term it is time for a correction and therefore now would not be the best time to enter long positions.

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