Iron ore prices are weakening, with spot testing support at $62/tonne. A Trend Index peak below zero would complete a bearish outlook, warning of strong selling pressure. Breach of support at $58 would confirm a primary down-trend.
The ASX 300 Metals & Mining index is testing resistance at 4000, remaining in a strong up-trend despite weaker ore prices.
Australian banks face a tough time over the next year or two but the ASX 200 index continues to strengthen despite weakness in its largest sector. A Twiggs Money Flow (13-week) trough at the zero line signals interest from buyers and breakout above 6150 would signal a primary advance, with a target of the October 2007 high at 6750.
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.