Tuesday, 17 June 2014

ASX 200 breaks below trend line drawn from lows of 2012, 2013 & 2014

Weekly chart including after hours trade. The market closed last week below the illustrated key trend line, opening the path for further weakness, an expectation which would be heightened by a break of last week's lows just below 5370.

S&P 500 futures turning lower from dual trend line resistance on hourly chart, big picture bearish

Hourly chart shows the S&P turning lower at dual trend line resistance.

Why look lower given the seemingly never ending up trend?? To see why, we have to zoom out all the way to the weekly chart, which shows a brief throw over completion of a bearish wedge formed from since the 2009 low. This indicates the market is in a place where the trend may be changing. There is a lot of market news due in the next 30 hours, so expect volatility, and new highs would blow the immediately bearish scenario out of the water, but for now it holds.

Next chart zooms in slightly on that weekly chart to show the throw over more clearly.

Next is the daily chart, showing another shorter term bearish wedge, or Elliott Wave ending diagonal. Read up on those things if you need to. A move below this week's low would confirm the throw over of the daily chart wedge, and also raise the odds of a bigger picture top.

Gold channeling lower on daily chart, room to rally on weekly but pressured lower

Daily chart shows Gold channeling lower. Continued down trend is a low risk play at this point but don't take it for granted. Low risk as in low points at risk, not high chance of success.... nobody knows the latter, ever.

Zooming out, the weekly chart shows that Gold has room to rally before trend line resistance comes in to play, so don't assume continual downwards one way traffic. That said, continued down trend must be given benefit of the doubt until there is evidence of an up trend, for now there is none.