Tuesday, 24 November 2015

ASX 200 headed below 3000 before the end of 2016

Monthly chart illustrates the most likely scenario for the coming 12 months. There has been no price action at lower timeframes to even hint that a lasting low is in.

Daily chart shows trend is down. No reason to doubt that this market will continue lower, which would confirm the break of trend line support on the monthly, and then < 3000 here we come.

S&P 500 weekly charts testing trend line resistance, trend is sideways biased down

First weekly chart shows the S&P 500 testing trend line resistance, and the moving averages indicate that the trend is sideways biased down. Subsequent charts zoom in to clarify the picture. Red vertical lines indicate that I think May 2008 could be a good analogy for where the market is now. Cascade decline ahead?

Second chart zooms in on recent action. A decline below 2020 in coming weeks would turn the trend to fully down (trend as indicated by the moving averages), and also raise the odds that the market had turned decisively lower from trend line resistance. A cascade lower as per 2008 would then be on the cards. Let's see.

Last chart zooms in on the action from late to 2007 to early 2009, for the record, and to show what can happen when the market trend turns decisively down. The red vertical line marks the beginning of the ferocious 2008 decline.

USD/JPY lower through trend line drawn from October and November lows