Wednesday, 31 August 2011

Aussie ASX SPI 200 monthly chart

As August draws to a close, let's revisit the big picture. It's bearish, no ifs or buts. The ASX 200 is currently trading at 4319.6 after hours, which places it firmly under the 40 month moving average. Momentum (MACDH) is negative and declining. Both these technical measures were also true in mid to late 2008, a period which saw a spectacular plunge. However the market is technically weaker than back then, as the current downward move is launching from a declining 40 month MA ie. the long term trend is already down, whereas the plunge in 2008 happened against a rising long term trend. The coming period will likely remind us that moves with the trend are far stronger than those against the trend.

S&P 500 hourly chart

Japanese Nikkei 225 hourly chart

Parallel trend lines.

Aussie ASX SPI 200 forming a triange

Hourly chart shown below, including after hours trade.

EUR/USD false break

Daily candlestick chart...

Gold and Silver rally

Needless to say, as soon as I published the post titled Gold and Silver hourly charts show weakness, they both began to rally. Maybe my nickname should be Pascoe.

Daily candlestick charts shown below.