It’s been awhile since I wrote about Japan’s Nikkei Index (NKD)…July 31st at this link.
After an initial drop at the right shoulder of a Head and Shoulders formation that was in play at the time, price rallied and has, once more, pulled back at the confluence of a double-top price level and triple-Fibonacci resistance level, as shown on the following Weekly chart.
Failure to hold its current level of 15,000 could, potentially, send price tumbling to around the 13,700 major support level, or even 12,600. Alternatively, watch for any increase in volumes on rallies…otherwise they may simply be dead-cat bounces, as has been the case since November of 2013.
I posted the chart below on twitter last night, and that shows SPX making the double-top target at 1937.70, then underthrowing falling megaphone support before rallying hard to form a nice looking IHS targeting the 1980 area.
I have to say I wasn’t wild about the low, which was in the right area but unusually didn’t show positive RSI divergence on any timeframe, but as long as the IHS breaks up today I’ll be taking that 1980 target seriously, and would note that the 50 DMA is now at 1975, and the 61.8% fib retrace and the daily middle band are both currently at 1985. This target would be a reasonable rally target and this would clear the pattern setup nicely for the next and likely much larger move down. SPX 5min chart: (more…)
After the run-up that China’s Shanghai Index has had since July of this year, this index may be on the verge of either a sizable decline or a somewhat volatile, and possibly lengthy, consolidation shortly.
The following 3-Year Daily chart shows SSEC to be at a major resistance level, and the RSI and MACD indicators are already in decline and do not support a further advance in SSEC.
SPX broke down hard yesterday and closed near the lows, giving bears their first complete day in a while. SPX broke back below the daily middle band and, as long as we don’t see a daily close back above it, the next obvious targets are the daily lower band at 1985 and the 50 DMA at 1976. The band pinch here means that it is very likely that SPX will start an extended band ride in the near future. The bulls had a shot at starting an upper band ride last week and couldn’t sustain it. If bears can get SPX to the lower band then they get a shot at starting a lower band ride instead. SPX daily chart:
To the casual eye, nothing of great interest happened on Friday, with a larger than usual dip that was bought, and more than half recovered by the close. Superficially that was just a third day riding the upper band and if we see a very strong recovery into and at the open, it’s possible that SPX could put in a fourth upper band ride day today. SPX daily chart: