Thursday, 2 January 2014

S&P 500 reaches trend channel resistance on weekly close line chart

The S&P 500 has reached trend channel resistance on the weekly close line chart.

Also of note, the S&P is now in a period where five separate "bottom to bottom to top" time spans indicate a possible market top could form. The chart below illustrates the 1942 - 1978 - 2014 configuration, and is taken from Peter Eliades' latest Stock Market Cycles report, which he is generously sharing free of charge. Please click through to see charts of the other four configurations.

Importantly, most stock markets around the world are mired in bear markets. For example, today I posted charts of the UK FTSE 100, the Japanese Nikkei, and the Australian ASX 200. To spell out the implication of those bear markets: new lows are likely below the 2009 lows for those markets. The US stock market is almost out on its own being above the 2007 high. A significant inter market divergence? I believe so, one that should resolve to the down side.

ASX 200 floundering below Fibo 61.8 retracement of 2007-09 decline, lower from mid channel resistance

Weak, weak, weak. The ASX 200 underperformed key global stock markets in 2013 when measured in the global currency (USD), as shown in David Scutt's excellent recent tweet. When global equities top out, the weakest market will be punished hardest of all, and sorry Australia, that's the ASX 200. Chartists don't need reasons why, but if you do, think housing mega bubble now expanded to completely delusional proportions, death of mining investment boom, and the ever expanding mass graveyard filled with decaying bodies of Aussie manufacturers.

EUR/USD turning lower from weekly chart trend line resistance? Testing key daily chart support



Nikkei pushes up through 20+ year trend line, meets next resistance, still below 2007 high

Still a bear market. Still likely to hit fresh lows in coming years. The first baby step to reducing the chances of new lows would be for this market to beat the 2007 high.

FTSE topping inside 14 year range?