China is dragging the ASX lower despite a resilient US market. Breach of medium-term support at 5340 warns of a correction. Declining 21-day Twiggs Money Flow indicates selling pressure and reversal below zero would strengthen the signal. The primary trend remains upward, however, and only breach of support at 5050 would signal a reversal.
* Target calculation: 5400 + ( 5400 – 5000 ) = 5800
ASX 200 VIX retreated to 13, indicating low risk typical of a bull market.
The Aussie Dollar is also proving resilient, testing resistance at $0.91 and the descending trendline despite weakness on the ASX. Upward breakout would suggest the down-trend is weakening. Recovery of 13-week Twiggs Momentum above zero would go further, signaling a primary up-trend, though only breakout above $0.97 would confirm. Reversal below medium-term support at $0.89 remains more likely, however, and would warn of another decline. Breach of primary support at $0.87 would offer a target of $0.83*.
* Target calculation: 0.87 – ( 0.91 – 0.87 ) = 0.83
Nice post. Probably the rate cut cycle is over for the Aussie.