Thursday, 13 November 2014

S&P 500 hitting record highs. ASX 200, Hang Seng, DAX lagging

Daily chart for the S&P 500 shows that it is hitting record highs, stretching out toward a test of trend line resistance.

4 hour chart for the S&P shows that very recent action has formed a bearish wedge.

Other stock indexes around the globe are lagging the S&P.

The Aussie ASX 200 has not yet come close to challenging its August peak, and the 4 hour chart suggests that it may be rolling over toward another leg lower.

I use the Hang Seng as my proxy Chinese stock index. The 4 hour chart shows it is forming a bearish wedge / a big bearish flag.

The German DAX is the key European index, and looks to be rolling over lower.

Gold rallying from trend channel support? Possibly formed a big bullish flag from 2011's peak?

Weekly chart first, shows that Gold looks to be rallying from trend channel support. Even if the recent low is broken, sentiment suggests that a significant low is near. Last week a chart pattern named the Vomiting Camel was applied to Gold and enjoyed great popularity on social media, even among many Gold bugs. When sentiment gets that sick toward the prospects of a market, it indicates that any market participant who may be a seller has likely already sold, so the only action remaining open to most market participants is to buy. Logically, lots of potential buyers and relatively few remaining potential sellers will drive a market higher.

Monthly chart begs the question, is the decline from 2011's peak a big bullish flag?

AUD/USD in early stages of a rally toward parity?

Market action since Tuesday when I pondered "AUD/USD significant low in place?" suggests the answer to that pondering is yes.

Daily chart shows the market rallying back inside the recent trend channel. Today's low tested the lower trend line from above, and while that level holds, it's fair to expect it to become a launching pad for a move to higher levels

Weekly chart down trend channel begs the question, is a rally toward parity on the cards? Certainly looks possible, though there's a deal of overhead resistance to overcome.