Germany’s DAX is consolidating between 7500 and 7900. Bearish divergence on 13-week Twiggs Money Flow still warns of selling pressure. Failure of 7500 would indicate a correction to test the rising trendline — around support at 7000.
* Target calculation: 7500 + ( 7500 – 7000 ) = 8000
The Italian MIB Index broke support at 16000. Following the earlier trendline break this warns of a primary reversal. Confirmation would come from breach of primary support at 15000. Reversal of 63-day Twiggs Momentum below zero would strengthen the signal. Respect of primary support would still not mean that trouble is over, as a lower peak followed by failure of primary support may follow.
The FTSE 100 displays a rising flag on its weekly chart, below resistance at 6400. Upward breakout would offer a target of 6800*. Downward breakout is unlikely but would signal a correction. Another 13-week Twiggs Momentum trough above zero would indicate strength in the primary up-trend.
* Target calculation: 6400 + ( 6400 – 6000 ) = 6800
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.