Global equity markets are at a critical juncture. Most of the major equity benchmarks are testing multi-year trend resistances. These are decade-long trend lines and if they are broken on the upside, it will signal further equity market strength for coming years.
STOXX 50 (includes UK companies), an equity benchmark for Europe, is testing 14 year-long trend resistance at 3,100 levels. While breakout would require a significant amount of energy (either positive news flow or expectation of positive economic outlook in the Euro zone), such price action (a decisive break above 3,100) will be extremely bullish for the European equities.
Japan’s Nikkei 225 index is testing a 20 year-long trend resistance at 16,500 levels. Decisive break above the strong multi-decade resistance will be extremely positive for the Japanese equities.
UK’s FTSE 100 index is now challenging historical high levels at 6,860. Breakout above the multi-decade horizontal resistance will also be a bullish signal for the global equity markets.
Last but not least, MSCI ALL COUNTRIES WORLD INDEX, which is a broad representation of global equity market performance is challenging historical high levels.