Flight to safety
By Colin Twiggs
September 6th, 2011 4:00 a.m. ET (6:00 p.m. AET)
10-Year Treasury yields fell to a new low on Friday, warning of further falls in the stock market as investors seek save havens in Treasurys and precious metals.
Dow Jones Germany Index broke support at 210/205 Monday, warning of another sharp fall as the ECB ramps up bond purchases and German participation in the bailout program is challenged in their High Court. Plunging 13-week Twiggs Money Flow indicates strong selling pressure. Target for the fall is the 2009 low of 150*.
* Target calculation: 200 - ( 250 - 200 ) = 150
The DAX Index similarly broke support at 5500, offering a target of 4500*.
* Target calculation: 5500 - ( 6500 - 5500 ) = 4500
Dow Jones Shanghai Index breached support at 320, confirming the earlier signal at failure of 330. Reversal of 13-week Twiggs Money Flow below zero warns of rising selling pressure.
* Target calculation: 330 - ( 360 - 330 ) = 300
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Remember that stocks are never too high for you to begin buying or too low to begin selling.
~ Jesse Livermore in Reminiscences of a Stock Operator by Edwin Lefevre.