Asia-Pacific: ASX breaks support
By Colin Twiggs
January 28th, 2014 3:00 a.m. ET (7:00 p.m. AEDT)
China's Shanghai Composite Index found short-term support at 2030 on Tuesday, but another test of the primary level at 1950 appears inevitable. Declining 13-week Twiggs Money Flow warns of selling pressure. Breach of support at 1950 would offer a target of the 2008 low at 1700*.
* Target calculation: 1950 - ( 2200 - 1950 ) = 1700
India's Sensex displays strong resistance at its 2007 and 2010 high of 21000, with several failed attempts at a breakout. Reversal below 20500 would warn of another correction to the primary trendline. Declining 13-week Twiggs Money Flow indicates medium-term selling pressure typical of a consolidation.
* Target calculation: 21000 + ( 21000 - 20000 ) = 22000
The ASX 200 broke support at 5200, signaling another correction. Reversal of 21-day Twiggs Money Flow below zero suggests short-term selling pressure. Recovery above 5250 is unlikely, but would indicate a bear trap. Failure of primary support at 5050 would warn of a primary down-trend.
The monthly chart illustrates the importance of primary support at 5000. Breach would confirm the down-trend, suggesting a fall to the long-term trendline, around 4600.
* Target calculation: 5300 + ( 5300 - 5200 ) = 5400
The ASX 200 VIX rose sharply, but (below 20) continues to reflect low market risk.
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