India’s Sensex followed through after breaking resistance at 17500, confirming a primary advance to 18500*. A 13-week Twiggs Money Flow trough above zero would indicate strong buying pressure.
* Target calculation: 17.5 + ( 17.5 – 16.5 ) = 18.5
Singapore’s Straits Times Index, also in a primary up-trend, is consolidating above former resistance at 3040. Reversal below 3000 would signal a test of the lower trend channel. It is still unclear whether 63-day Twiggs Momentum will oscillate around zero, indicating a ranging market, or above zero, indicating a healthy up-trend. A trough above zero would resolve this.
Japan’s Nikkei 225 index broke through resistance at 9100, signaling a primary advance to 10000. 13-Week Twiggs Money Flow below zero continues to warn of selling pressure; recovery would confirm the advance.
* Target calculation: 9100 + ( 9100 – 8200 ) = 10000
The daily chart shows China’s Shanghai Composite Index testing support at 2100. Failure would indicate a test of the lower trend channel, while respect would test medium-term resistance at 2180. Breakout above the trend channel would warn of another bear rally. Follow-through above 2180 would confirm. Bullish divergence on 21-day Twiggs Money Flow indicates medium-term buying pressure.
* Target calculation: 2100 – ( 2180 – 2100 ) = 2020
The Hang Seng continues to consolidate above resistance at 20000. Follow-through would indicate an advance to 22000*. Rising 13-week Twiggs Money Flow suggests buying pressure.
* Target calculation: 20 + ( 20 – 18 ) = 22
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He founded PVT Capital (AFSL number 546090), which provides income and growth strategies to wholesale clients.
Colin also co-founded Incredible Charts and writes the popular Patient Investor newsletter.
Using a top-down approach, Colin identifies macro trends in the global economy and then combines fundamental and technical analysis to evaluate opportunities in sectors that stand to benefit.
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.