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Asian selling pressure while US finds support

By Colin Twiggs
May 25th, 2017 11:30 p.m. EDT (1:30 p.m. AEST)

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Asia faces selling pressure. The canary in the coal mine is South Korea's Seoul Composite Index which displays a strong bearish divergence on the Trend Index. Breach of 2350 would signal a primary down-trend.

Seoul Composite Index

China does not fare much better, with the Shanghai Composite Index testing primary support at 3,000.

Shanghai Composite Index

Japan also displays selling pressure, but the Nikkei 225 Index has a bigger cushion above primary support at 20,500.

Nikkei 225 Index

And India's Nifty has run into stiff resistance at 11,000. Reversal of the Trend Index below zero would warn of strong selling pressure and a test of primary support at 10,000.

Nifty Index

The UK is stronger, with the Footsie testing resistance at its January high of 7,800. Twiggs Money Flow troughs at zero indicate continued buying support.

FTSE 100

The DAX is weaker, with bearish divergence warning of selling pressure, but this still appears secondary in nature.

DAX

The S&P 500 broke out of its symmetrical triangle and is retracing to test support at 2700. Volatility is falling and the decline in Money Flow easing. Respect of 2700 is likely and would signal a rally to test 2850.

S&P 500

The Nasdaq 100 is stronger and breakout above 7000 would signal a fresh primary advance.

Nasdaq 100

Favorable resolution of US trade negotiations with China and the impasse with North Korea would be key in the recovery spreading to the global economy.

It was the change in my own attitude that was of supreme importance to me. It taught me little by little, the essential difference between betting on fluctuations and anticipating inevitable advances and declines, between gambling and speculating.

~ Jesse Livermore

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Colin Twiggs is director of The Patient Investor Pty Ltd, an Authorised Representative (no. 1256439) of MoneySherpa Pty Limited which holds Australian Financial Services Licence No. 451289.

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