Shanghai Composite Index threatens to complete a double top reversal with breakout below the neckline at 2250. Failure of support would offer a target of 2000*. Respect of the zero line by 63-day Twiggs Momentum warns of a continuing primary down-trend. Respect of support is less likely, but would indicate that a bottom is forming.
* Target calculation: 2250 – ( 2500 – 2250 ) = 2000
Hong Kong’s Hang Seng Index found medium-term support at 18000. A rally that respects resistance at 20000 would confirm the primary down-trend signaled by 63-day Twiggs Momentum below zero. Breach of primary support at 17500/18000 would offer a target of 16000*.
* Target calculation: 18 – ( 20 – 18 ) = 16
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.