Wednesday, 2 December 2015

ASX 200 rallying toward cluster of resistance around 5400?

Start with the big picture, always. Monthly chart. Nobody knows if my wave count and scenario will prove correct, but  I have seen nothing to suggest that it is wrong, So I will stick with it, unless the market tells me not to. Charts include all sessions trade.

Weekly chart next. While the market is below the red 40 week moving average, a cascade decline such as 2008 is possible. That moving average is my line in the sand for the near term bearish case. It's currently just below 5500.

Daily chart shows the market is perhaps pushing through short term trend line resistance, but is near stronger trend line resistance around the 5400-5450 zone. The market must beat the illustrated trend lines before it can have a crack at the 40 week moving average. I would not be holding my breath waiting for that outcome, but I've been surprised before, many times. Markets do that. Let's see.

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