Wednesday, 25 May 2011

ASX 200 trend channel breakout tested

The trend channel breakout on the hourly candlestick chart identified earlier in the day is being tested after hours. Only a move through the nearest down trend line currently at 4630, and especially a move above the highs of the past 24 hours at 4652, would raise the odds of the earlier move being a false break.  The action in the S&P 500 tonight will be critical.

S&P 500 SPX trend channel still in play on hourly

This hourly candlestick chart shows a bounce off the lower channel line over the past 4 hours. How will this play out against the trend line break at the daily time frame? We'll have to wait and see.  

EUR/USD hourly ruler and pencil view

Good old ruler and pencil has been all you need to find trading edges for the EUR/USD since the peak in early May.

AUD/USD daily testing support

Daily candlestick chart shows that the market is testing support at the top of the earlier trading channel.

ASX 200 down trend accelerates

This hourly candlestick chart shows the market breaking down out of the trend channel that had contained price action since the mid April high, signalling a likely acceleration of the down trend. Earlier posts show major trend line breaks have also been seen this week in Chinese and US markets. 

S&P 500 SPX decisively breaks trend line after New York close

The market has broken down through the trend line formed from last September's low. There is a bearish cross of the 18 day and 40 day moving averages. I will now consider the trend to be down at this time frame unless the market closes New York trade above the trend line. There may be support around 1300, and then 1250. 

Gold yet to confirm resumption of up trend

On the daily candle chart, we see that the market is attempting to resume the up trend.

The hourly candle chart shows that the market is yet to break the down trend line formed from the early May high. A break upwards through that line would add some confidence that the up trend at daily chart level is resuming. To my eye, only a sustained break above the corrective channel formed from the lows would give enough confidence to take a bullish stance. The top line of that channel is just below 1540.

China H-shares index

The H-shares index is comprised of companies incorporated in China but traded in Hong Kong. The weekly candle chart of the index shows that it is breaking downwards through the trend line formed from the late 2008 lows. A downwards break of the parallel trend line in 2008 saw the market drop more than 50%  within months.