The FTSE, DAX and CAC end 2024 with mixed signals.
Major European stock indices were anything but aligned in closing out 2024. In the UK, the FTSE 100 Index closed December down for both the month (-1.38%) and the quarter (-0.78%), but was able to finish the year up (+5.69%).
In Germany, the DAX Performance Index closed in positive territory across all three time levels: monthly (+1.44%), quarterly (+3.02%), and yearly (+18.85%).
Unfortunately in France, things were a bit different. While the flagship CAC Index finished December up for the month (+2.01%), it wasn't enough to make up for earlier losses and still finished down for the quarter (-3.34%) and for the year (-2.15%).
Taking a broader look at the Europe STOXX 600 Index, December closed down on a monthly (-0.51%) and quarterly (-2.92%) basis, but was able to eek out a positive close for the year (+5.97%). Meanwhile, the more narrow but popular EURO STOXX 50 Index was a bit of a mini-roller coaster, closing December up for the month (+1.91%), but down for the quarter (-2.09%), and yet still up for the year (+8.28%).
Now, let's take a look at some monthly price charts to visualize the big picture performance. Similar to he US stock markets, you can see an uptick since late 2022 across most of the European indices, along with a spike of the yellow stochastic and a bounce (and then leveling out) of the Energy Model.
When studying price charts in the Socrates Platform, pay close attention to the trend lines as well as the oscillators - the Stochastic and the Energy Model. When the Energy Model spikes well above its moving average, it indicates a higher risk of losing momentum, which could mean a change in direction may be ahead. When studying the Stochastic indicators it's popular to study the numerical values >80 (possible overbought conditions) and <20 (possible oversold conditions), as well as crossovers of the red and blue lines. The Socrates Platform includes a third Stochastic (Yellow) to study and when it crosses both red and blue it can also be a helpful indicator.
Researching markets across different time levels offers a much better view of short-term vs long-term activity. Many follow financial markets on a daily basis, which can certainly be helpful - especially at times of potential market entry or exit - but it's important to keep in mind price movement on the daily time level is most vulnerable to spikes in volatility with reactionary price moves. The monthly (and quarterly) time level tends to even out the noise a bit by contrast, providing a cleaner view of actual market trends over the long-term.
Regardless of time level, a change in direction can just be a (relatively) short-term move or brief market correction, it does not necessarily mean it is a true change in the longer term trend. This is why studying market behavior consistently over a period of time, and across multiple time levels (daily, weekly, monthly, etc) is helpful.
Also, while intra-day price movement is worth studying, the Socrates Platform proprietary computer models more heavily weight closing price for each time level as it's a stronger signal of the market's sentiment for that trading period (that day, that week, etc).
Log in to research these and other global financial markets. Go beyond the charts with the Global Market Watch pattern recognition (monthly, quarterly and yearly in particular) along with the Indicating Ranges on a weekly and monthly closing basis. See how - or if - price movement aligns with what different technical indicators and models are picking up on across various time levels (weekly, monthly, etc). This can help shed light on what might be ahead on both a short and long term basis.
Pro and Enterprise members can go deeper in their research with the Reversal System and Timing Arrays, as they look for potential turning points ahead. Keep an eye out for clusters of Reversal points as they represent areas of technical support (Bearish Reversals) and technical resistance (Bullish Reversals). Take note of any relatively large gaps in where Reversal points exist, as it may highlight where a market could see notable price movement before reaching support or resistance.
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With over 1000 global financial instruments to research, from stocks, commodities, bonds, and more, the Socrates Platform allows members to monitor financial market activity from around the world using price charts, technical studies, custom watchlists, unique indicators, and proprietary computer models (the Reversals, Timing Arrays, Global Market Watch, Indicating Ranges, and the Energy Model).
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