Hong Kong’s Hang Seng Index is retracing after a sharp bearish divergence on 21-day Twiggs Money Flow. The longer term 13-week indicator, however, suggests no more than a secondary correction. Breach of the rising trendline, however, would warn that the trend is losing momentum.
* Target calculation: 20000 + ( 20000 – 17500 ) = 22500
The Shanghai Composite Index is retracing to test support at 2300. Failure would indicate continuation of the primary down-trend, while respect would suggest that a base is forming. A further peak below zero on 63-day Twiggs Momentum would signal another decline.
* Target calculation: 2150 – ( 2500 – 2150 ) = 1800
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.
Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.
Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.