Thursday, 8 November 2012

S&P 500 breaks lower, no ifs or buts

For a couple of weeks I have been showing two up trend channel scenarios for the S&P 500, for arguments sake calling one bearish and the other potentially bullish. Last night the S&P 500 broke downwards from the potentially bullish trend channel, reducing the odds of any near term bullish potential. More importantly the market closed below a shelf of support just below 1400, at the level of multiple lows from August, September, and October.

The first chart illustrates the trend line break from the ex-potentially bullish scenario.

The second chart illustrates the channel that turned out to be the more effective measure of market action, and this is the scenario I will go forward with, although it is already fading in to history and the focus going forward should be on defining the newly developing down trend.

EUR/USD breaks final trend line support to resume big picture down trend

As I tweeted a little while ago, the EUR/USD has broken below the potential bull flag, as shown in the first chart below. I think that in doing so it has broken the final trend line support level that be constructed from the rally and consolidation of recent months, and resumed the big picture down trend shown in the second chart.

ASX 200 returns to down trend channel

There was no follow through on yesterday's ASX 200 upside break from the bull flag, or is it a down trend channel? The market returned to the channel in after hours trade last night, and remains there now.

EUR/USD turns lower from trend line retest

The EUR/USD has turned lower from a retest of the trend line drawn from multiple lows of the past two months. It has not yet pushed decisively lower from the potential bull flag I illustrated on Tuesday. Longer term it remains within the down trend channel illustrated on the weekend.