In today’s Indices outlook, Paul Rodriguez, Director at ThinkTrading, speaks on the October cyclical sensitivity, commodity bounce and shares the technical insights for DAX and S&P 500 equity index.
Currency the main driver
Rodriguez comments how the October cyclical correction is seen in the markets, with volumes remaining really low.
On this correction, he notes how the market driver – FX, remains trapped in a range with most people being obsessed on the rates.
DAX: Still way off a market top
On the DAX, Rodriguez believes that despite the rally seen in the equity index, we are still way off a market top and it would be premature to get excited.
He adds how the DAX could be building into a descending triangle and falling below 10,200 would see a very sharp downmove, but moving above 10,600 might start building for new highs.
S&P 500: Collapse ahead?
Continuing the bearish theme, Rodriguez believes that the S&P 500 equity index might be building into a very nice classic head and shoulders topping formation and will likely fail near 2045-50 area. He adds that the index will likely consolidate after this and collapse after approaching the neckline.