Technicals | Mar 16 2015
By Nick Linton-Ffrost
Sideways before the next leg lower
We suspect the ASX200 (XJO) has formed a medium term top at 6000 and we are assuming that slide from 6000 to 5740 is an “a” wave within a move lower to 5600-5550. We expect to see some sideways price action between 5800 and 5925 over the next 2-3 days before the next leg lower.
We therefore suggest selling rallies closer to 5925 or waiting for a lower high to form before opening shorts. It is worth noting that the 5/20 MA’s have crossed into a sell. We only use MA’s as a secondary indicator not a trading trigger.
Our alternative view is that the move from 6000 to 5740 is part of a 4th wave consolidation which will provide a base for a rally to 6100. Trading above 5950 for more than three days would turn the odds in favour of that view.
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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