The current course of the AEX Index
It is Friday, August 23, and the AEX is at 907 in the morning session. That is 19 points (2.1%) higher than last week's reading.
The AEX continued its recovery from last August 5's 840 level and opened the week Monday morning at 903. The low was 902 and Thursday morning the AEX reached its weekly high at 913. This peak was reached in part due to a strong performance by heavyweight Unilever. A relatively quiet week in which the strong recovery continued.
Above is the chart of the AEX since January 1, 2024. You can see the most likely scenario for this year penciled in.
What does this mean for the sentiment?
Sentiment in stock markets has turned slightly to positive due to the strong recovery. A strong rise soon makes one forget the previous decline. The situation can currently be described as "make or break." Sentiment is upward but technically the downturn is not yet complete.
What is the expectation of the price movement of the AEX Index?
The algorithm is neutral on the AEX. Because of the high volatility at the time of the decline at the beginning of this month, we are also seeing larger-than-expected lows in the recovery. The recovery from the 840 to the 913 is strong but remains a recovery after a larger decline.
The most likely scenario is that the AEX completes the recovery in the 910-920 zone. In the coming week, the AEX could still test the 921 as the final move of the recovery. As reported, though, this is the Make-or-break zone. Then the larger correction will be completed by a decline of the AEX in the coming months to the 820-810 level.
The major trend is up and the indicated decline is a healthy correction and offers perfect opportunities to buy shares for the longer term. AEX price target remains 1025 points.
Back view: read our view of the AEX from August 14, 2024, here
The price movement of the Nasdaq
The Nasdaq futures are currently at 19,680 which is 630 points (3.3%) higher than last week's reading.
The Nasdaq futures have continued their strong recovery. From the low of 17,300 (Aug. 5), the price even briefly surpassed 20,000 points on Thursday. Over the past week, the strong and moving Nasdaq futures have also been relatively quiet with price movements between 19,500 and 20,000 points.
What is the expectation of the Nasdaq's stock price movement?
Because of the very high risk, the algorithm is neutral on the Nasdaq. The same scenario applies to the Nasdaq as to the AEX. In the most likely short-term scenario, the Nasdaq has already completed the recovery and can continue the correction from the current level and complete it at the 16,500 level.
Importantly, this scenario does not yet have initial confirmation so there is no valid short signal. Especially with the risky Nasdaq, the price must now show a confirmation signal before a position can be taken. Currently, the risk of a fierce continuation of the current rise is still too high.
After the correction, the Nasdaq may resume its strong trend toward the long-term price target of 22,900 points for the future.
Below is the chart of the Nasdaq100 -future since January 1, 2024, with the most likely scenario plotted.
Important items on the economic calendar for the week of Aug. 26 through Aug. 30:
In the week ahead, the focus is on inflation figures from the US. These will be published at 2:30 p.m. on Friday. Further attention to US consumer confidence on Tuesday at 4 p.m.
Disclaimer: Investing involves risk. Our analysts are not financial advisors. Always consult an advisor when making financial decisions. The information and tips provided on this website are based on our analysts' own insights and experiences. They are therefore for educational purposes only.
