Market suppressed under the roof top line and last week, we forecast market to retrace back to this roof top resistance and come down.
Although market has retraced but it didn't touched the rooftop line, and continue to trade down below initial support. Then, market fall but didn't touch the target exit... as a conclusion, Market neither touched my forecast resistance nor support level, but the direction is still alright.
From the economic data front, US dollar continues to rise and Fed Chairmen Mr. Ben announced to keep the monetary policy unchanged. This week there will be announcement of Building Permits, Existing Home Sales, Core Durable Goods Orders m/m, and New Home Sales.
The housing data are forecast to go up higher, similarly the consumer data is expected to inch higher and therefore we forecast a Christmas Rally to happen – if there’s no news from the Euro-zone debt crisis.
Encourage to read this article to gain insight of the top 10 economic data for the week.
http://www.fxstreet.com/fundamental/market-view/the-trading-week/2011/12/17/
Technical Forecast
From the technical chart, DJIA has formed a big bearish candle last week and market is going to be under pressure.
Existing Group Resistance 11965.
Next Support 11785.
Thursday and Friday daily candle shows market finding support and consolidating. Forecast market to move sideways between 11800 – 950 (150 – 200 pts) until Wednesday night – Existing Home sales data release.
If the data release is good, then the Christmas rally should lead DJIA back to 12180.
If market failed to sustain above support 11785, and if in line with a shock from Euro debt crisis worsen, then market shall come down below 11600.
NASDAQ 100
From the daily chart, market is prone to bearish sentiment, but we are expecting fundamentally strong economic data announcement this week, which might fuel a Christmas rally.
Last week, Nasdaq 100 has hit the strong support 2219-2220 and retraced, 1/3 retracement up to 2260 and started to trade sideways. I forecast NASDAQ100 to retrace up to 2260 again, and test strong resistance 2280.
Strong Resistance: 2295
Resistance2: 2280
Resistance1: 2260
Current Support: 2225
Support2: 2219
Strong Support: 2180
If the announcement is good, the news might lead Nasdaq 100 to go above 2280 and hit 2295, which is the wave target price of the 30 minutes inner wave (up).
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