Uncertainty of Markets : Global market review (DOW,S&p, NASDAQ, HK Market and DAX ) 2-2-2012

Global markets had an enormous rally for Jan2012, beating all other years on the past Decade. They say that if Jan closed on the positive side, 80% of the time, Dec year-end will be higher compared to 1st trading day of January. Let us review on the current status of our Global Markets.




Let us start with U.S., DOW, S&P and NASDAQ don't have common thing in terms of Bullishness - Bearishness. DOW Jones was the only one who was able to revisit the April2011 high. And Dow Jones was the only one to breakout of the possible Bearish Downtrend lines. With this, I mark DOW below as the Bullish Scenario, where once it breaks out of 118xx (the April2011 and Jan2012 highs). We can assume that 13,000 and 13,500 will be the next resistances.

Long Term: Uptrend with Major Support at 11,600
Medium Term/Short Term: Pull back very likely to happen





S&P and NASDAQ Above shows that the POSSIBLE medium term downtrend lines are still intact, and they have not reached their April 2011 highs yet. Showing signs that it is a mixed deciding factor of investors who to follow on the real U.S. trend and what Sectors are Bullish or Bearish.

Overall, I can safely say, all 3 major index are now near its Major Resistance Levels, and can safely put out a recommendation to wait for further correction before trading in. (a good 3-8% correction is healthy for this market)

S&P and NASDAQ:
Long Term - Uptrend
Short Term - Pullback is likely to happen



My Favorite Asia Index. Hong Kong. Is now trading at 9.0 X P/E 2011F, still below the 12x Average in Asia. Still seems to be cheap and a very tradable market.

The huge rally from 18.5k was spectacular, hitting 20.5k instantly for an 11% profit. I got out of this market too early @ 20k, and planning to get in once it corrects to the RED Circle area, around 19.5k - 20k correction is an opportunity to BUY. Long Term Trend is Neutral, Medium Term important trend is DOWN with Major Resistance at 22.50k, still a 19.5k entry point and 22.50k selling point is a huge 15% tradable range.

Long Term: Neutral
Medium Term: Downtrend
Short Term: Rally is good, and a correction around 19.5k-20k is a good re-entry point.



Germany leads the European debt with its strong Economy, Even though London contracted last Q4. I really think Germany and other huge Indeces are still not Long Term uptrend unlike the United States. I can safely bet that U.S. is the powerhouse, and European Debt is just a piece of problem U.S. is encountering before it fully recovers from the 2009 Recession.

Medium Term, I really think that the 6800 Major Resistance is a possible hindrance to Germany's enormous rally this Jan2012. I forecast Germany to hit near 6800 area before Greece Problems in March2012 can make his Index lower, or at worst, resume its Medium Term Downtrend lines.

Rally was too good to be true, still a European Default and domino effect can erase all our Nov-Jan2012 gains, and can revisit the Oct2011 lows.

Time will tell if what will happen.

Long Term: Neutral to Sideways
Medium Term: Downtrend
Short Term:Uptrend and Overbought