The ASX 200 retreated more than 2.0% Monday after the Cyprus deposit grab unsettled financial markets. Expect another test of support at 4980. Breakout would warn of a correction, while recovery above 5150 would signal an advance to 5500*. Declining 21-day Twiggs Money Flow indicates medium-term selling pressure.
* Target calculation: 5000 + ( 5000 – 4500 ) = 5500
Dow Jones Japan Index dropped about 1.5%. Follow through below short-term support would indicate no more than retracement to the rising trendline.
Dow Jones Hong Kong Index has fallen about 2.0% so far. Breach of support at 472 signals a correction.
Dow Jones Singapore Index has fallen 1.0% in the morning and we can expect further weakness in the p.m.
European markets are likely to open lower. If the US follows and finishes the day with a weak close, negative sentiment could start to feed on itself, tipping global markets into a correction. Overall, the primary trend in the US and Australia remains positive.

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.
About time for something more than just a day or two down. Nobody likes down markets, but if we don’t see a decent pullback or consolidation for a while here then to my mind any subsequent rally is suspect.
Hi Colin
I’ve seen this a couple of times now and not quite sure what you mean…
Respect of support at 5000 is likely, but even a stronger correction would not disrupt the primary up-trend:
Regards,
Grant
Corrections are secondary movements and do not alter the primary trend: one step back, two steps forward.