Technicals | Oct 20 2010
By Rudi Filapek-Vandyck
The TechWizard reports there seems to be potential for the Australian share market to form a so-called "diamond top" on price charts, which would be a bearish signal. The Wizard explains such a technical pattern usually indicates a major top has been formed and the new direction is down.
Also, history shows that diamond tops are often followed by steep sell-offs, he says.
The Wizard explains that a weekly close below 4500 for the ASX200 would be "extremely bearish". On the other hand, a weekly close above 4700 would be a genuinely bullish reversal
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 The views expressed are the Wizard's, not FNArena's (see disclaimer).
