Technicals | Apr 11 2016
By Nick Linton-Ffrost
Medium term low expected between 4820 and 4900 before heading north to 5400
We suspect the ASX200 has or is close to completing a (B) wave lower from 5225. The implication is for a (C) wave rally towards 5400 over the next 2 months. View based on the following –
- completion of five major waves down from 6000 implies a bounce to the top of wave (4) around 5400
- the corrective rally should trace out a three legged structure (A.B.C)
- rally from 4700 to 5225 is wave (A) after tracing out five minor waves
- descent from 5225 is wave (B) which should complete between 4830 – 4900
- the 4830 – 4900 is the target range is derived from the break below the line around 5080
- (C) carries to 5350 – 5400 where (C) approximates (A)
Two ways to trade our view –
- Open longs with a break above 5000 placing stops below 4925
- Look for buy signals between 4820-4850 over the next week
Trading below 4825 for 2-3 days negates our view and should set up a descent to 4700.
Another trading idea from
Fifth Wave | fwtc.com.au
FW generates over 150 Trading Alerts on the ASX100 each year. We are a subscription service specialising in short term technical strategies based on 27 years experience.
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