Japan’s Nikkei 225 retreated below support at 16000 and is testing the long-term trendline. Breach of support at 15000 would warn of a test of primary support at 13200, while recovery above 16000 would suggest a primary advance to 17500*. A rising Dollar/Yen exchange rate would strengthen the bull signal.
* Target calculation: 15000 + ( 15000 – 12500 ) = 17500
European recovery is highlighted by performance of the euro. Recovery above $1.37 would be bullish, while breakout above $1.38 would confirm a primary advance, with an immediate target of $1.43*. Reversal below $1.355 is unlikely, but would warn of another test of primary support at $1.33.
* Target calculation: 1.38 + ( 1.38 – 1.33 ) = 1.43
Dow Jones Euro Stoxx 50 continues to test new-found support at 3100. 13-week Twiggs Momentum holding above zero suggests a healthy up-trend. Follow-through above 3100 would confirm an advance to 3350*. Breach of the rising (secondary) trendline is unlikely, but would warn of a test of the primary trendline and support at 2850.
* Target calculation: 3100 + ( 3100 – 2850 ) = 3350
The FTSE 100 reflects selling pressure, with a large bearish divergence on 13-week Twiggs Money Flow, but breakout above resistance at 6800 would indicate a test of long-term resistance at 6950/7000. Completion of another 13-week Twiggs Money Flow trough above zero would strengthen the signal. Breach of the primary trendline is less likely, but would warn of a reversal, while breach of primary support at 6400 would confirm.
* Target calculation: 6700 + ( 6700 – 6400 ) = 7000
Canada’s TSX 60 is retracing to test its new support level at 780. Respect would confirm an advance to 820*. Bearish divergence on 13-week Twiggs Money Flow suggests nothing more than secondary (medium-term) weakness unless there is a crossover below zero. Breach of the rising trendline is unlikely, but would test primary support at 750.
* Target calculation: 780 + ( 780 – 740 ) = 820
TSX 60 VIX is rising but remains bullish.
Declining CBOE Volatility Index (VIX) readings for the S&P 500 continue to indicate a bull market.
The S&P 500 itself is headed for another test of short-term resistance at 1850. Breakout would confirm the target of 1910*, while respect would warn of a correction, especially if followed by reversal below 1800. The recent decline in 13-week Twiggs Money Flow was secondary in nature and less severe than the corrections in June and August 2013; troughs high above the zero line are a long-term bull signal.
* Target calculation: 1810 + ( 1810 – 1710 ) = 1910
The Nasdaq 100 continues its accelerating up-trend, with Twiggs Money Flow troughs above the zero line indicating long-term buying pressure. The last decent correction was in June 2013 and continuation of the advance much further without a correction would suggest the market is becoming over-extended.
The Gold Bugs Index, often a leading indicator of spot prices, is retracing to test the new resistance level at 210. Respect would confirm a decline to the 2008 low at 150. Recovery above 280 — and 13-week Twiggs Momentum crossover to above zero — would signal reversal to a primary up-trend, but that is unlikely at present.
Spot gold respected long-term support at $1200/ounce and follow-through above 1250 would suggest a bottom is forming. Recovery of 13-week Twiggs Momentum above zero would indicate a primary up-trend. Failure of $1200 is more likely, however, and would warn of a decline to 1000*.
* Target calculation: 1200 – ( 1400 – 1200 ) = 1000
Higher interest rates and a stronger dollar would increase downward pressure on gold.
The yield on ten-year Treasury Notes encountered strong resistance at 3.00 percent. Retracement is headed for a test of support at 2.75. Breach of that level would test primary support at 2.50, but reversal below 2.50 is unlikely. Breakout above 3.00 is more likely and would offer a target of 3.50 percent*.
* Target calculation: 3.00 + ( 3.00 – 2.50 ) = 3.50
The Dollar Index has twice respected resistance at 81.50 and we can expect another test of medium-term support at 79.80, but penetration of the declining trendline indicates downward momentum is fading. Respect of 79.80 would suggest another test of 81.50. Breakout above 81.50 would signal a primary advance, with recovery of 13-week Twiggs Momentum above zero strengthening the signal.
* Target calculation: 81.5 + ( 81.5 – 79 ) = 84
The ASX 200 retracement is testing support at 5300. Rising 21-day Twiggs Money Flow indicates medium-term buying pressure. Recovery above 5380 would suggest an advance to 5850*. A declining Shanghai Composite could impact on the resources sector. Reversal below the October 2013 low of 5150 is not likely, but would be cause for concern.
* Target calculation: 5450 + ( 5450 – 5050 ) = 5850
Japan’s Nikkei 225 is retracing to test its latest support level at 16000. Rising 13-week Twiggs Money Flow after a trough above zero indicates buying pressure. Respect of support would confirm a primary advance, with a long-term target of 17500*. A rising Dollar/Yen exchange rate would strengthen the signal. Breach of the rising trendline is unlikely, but would warn of another correction.
* Target calculation: 15000 + ( 15000 – 12500 ) = 17500
China’s Shanghai Composite breached support at 2080, confirming the primary down-trend. Expect support at 1950: the low of December 2012 and respected in 2013. Twiggs Money Flow below zero indicates selling pressure. Recovery above 2080 is unlikely but would warn of a bear trap.
India’s Sensex encountered strong resistance at 21200 and declining 13-week Twiggs Money Flow warns of medium-term selling pressure. Expect another test of support at 20200. Failure would warn of a primary down-trend. Breakout above 21200 is unlikely in the next few weeks, but would suggest a primary advance to 22000*.
* Target calculation: 21000 + ( 21000 – 20000 ) = 22000
Canada’s TSX 60 is in healthy shape, with 13-week Twiggs Money Flow troughs above zero indicating strong buying pressure. Breakout above 780 would confirm an advance to 820*. Reversal below 740 is most unlikely, but would warn of a test of primary support at 675/680.
* Target calculation: 780 + ( 780 – 740 ) = 820
Short (3-day) retracement on the S&P 500 would indicate a strong trend. Follow-through above 1850 would confirm the target of 1910*. Rising 21-day Twiggs Money Flow highlights medium-term buying pressure.
* Target calculation: 1810 + ( 1810 – 1710 ) = 1910
CBOE Volatility Index (VIX) readings below 20 continue to indicate a bull market.
The Nasdaq 100 continues its accelerating up-trend, with rising Twiggs Money Flow troughs above the zero line indicating strong buying pressure. The last decent correction was in June 2013 and continuation of the advance much further without another correction of at least 2 to 3 weeks would suggest the market is becoming over-extended.
