4500 Looming For The ASX200

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By Rudi Filapek-Vandyck

The TechWizard is not mincing his words this morning: expect the ASX200 back at key technical support at 4500, and let's hope it doesn't sink below it.

The Wizard notes his proprietary trading system has now started generating red bars which means investors should brace for more selling than what we've experienced thus far this month. Last night's heavy falls on Wall Street are only further proof of this, he adds.

In addition, technical analysts at Barclays Capital report the S&P500 index in the US has now completed a head-and-shoulders pattern on their price charts and this usually signals a reversal in trend.

Their message is as dire as the TechWizard's: more weakness should be in store. Note the analysts at Barclays maintain equity markets are in a long term uptrend and the weakness experienced now is nothing but a counter-trend correction, in their view.

The TechWizard is the pseudonym of Scott Morrison, whose experience in financial markets exceeds twenty years. Morrison operates his own website nowadays at www.techwizard.com.au

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