Sunday, 4 September 2011

Aussie ASX SPI 200 perched on trend line

The ASX 200 closed on Friday at 4243, but with Friday's declines in Europe and on Wall Street, after hours trade closed the week at 4172.

The hourly candlestick chart for the past month shows that the market is perched on a trend line (funnily enough, so is the AUD/USD). Therefore whichever way the market moves on Monday will be significant at this time frame, either a trend line bounce or break...


Zooming out to the weekly candlestick chart, we see a strong down trend, and repeated rejection of resistance from the 2010 lows, just above 4200...


If you'd like to zoom out one step further to the monthly chart, click here to see a recent post (August 31).

AUD/USD testing trend line

Hourly candlestick chart for the past month is shown below. The AUD/USD has held up more than I expected the past few days, given the strong declines in both the EUR/USD and global stocks. It is now testing the trend line drawn from the August low...

S&P 500 bear market

Hourly candlestick chart for the past month...


Zooming out to the weekly chart, we see the justification for this post's title, the strong down trend. Also the most recent candle is an indicator of weakness heading in to the new week, shows the market opening low at the beginning of last week, then rallying strongly (greed), then closing the week lower than where it opened (FEAR)....


Now zooming out even further to the monthly chart. Personally I hope that this head and shoulders top scenario does not play out, as it would surely be accompanied by a worldwide economic decline of enormous severity. However the labels on the chart are valid, and we should at least entertain the possibility...


EUR/USD parallel trend line break

Long term daily candlestick chart shown. Is the recent trend line break more significant because the line is parallel to the one whose break lead to the large decline in 2009/2010?


Silver approaching resistance from two trend lines

Daily candlestick chart, showing a trend line drawn down from the 2011 peak, and another that has touched many short-term tops over the eighteen months...


Gold continues to trend up

Gold daily candlestick chart...