Despite the evident strength in the most-watched US stock indices (S&P, Nasdaq, Dow) there has not yet been a ‘break away’ from the compression signals that we have been reporting, so we still can’t state with any confidence that a new trend has begun. That may all change by the end of today if US prices can make slight further gains. Here we repeat the charts sent last week, showing the weekly compression signals in equity indices that have been occurring in every part of the world. They are annotated:
The situation in Europe is a bit more bullish as a French index that we follow has now joined Germany in breaking upward from weekly compressions. Spain has been a laggard but it may catch up:
The UK situation also looks bullish, as a weekly scale compression that formed while the current new consensus on Brexit was still developing, has also since broken upward. We remain bullish of the FTSE, as we have been since early in the year:
There is one small caveat to the bull case, even in Europe, as there have been a couple of daily-scale top extensions in those stock indices that have gone up most rapidly in the last week or so, including one in the Dax. These usually lead to a dip or a pause in an uptrend which probably means that there is still a little time to sit on our hands and contemplate some more, before committing to a full bull view here:
All signals courtesy of software supplied by our friends at Parallax Financial Research www.pfr.com
