Australia’s ASX 200 index displays stubborn resistance at 4300, but rising 13-week Twiggs Money Flow indicates buying pressure. Upward breakout would signal a primary up-trend, with an initial target of 4650 and a long-term target of 4950*. The right-angled broadening pattern reflects weak support and downward breakout would test primary support at 4000.
* Target calculation: 4400 + ( 4400 – 3850 ) = 4950
Japan’s Nikkei 225 index also shows a bearish divergence on 21-day Twiggs Money Flow, warning of a correction. The next medium-term support level below 10000 is the former resistance level at 9000, so there could be a fairly sharp fall. But the primary trend is up and recovery above 10200 would signal an advance to 11000*.
* Target calculation: 10 + ( 10 – 9 ) = 11
Despite global weakness, South Korea’s Seoul Composite Index continues to test resistance at 2050. Bearish divergence on 21-day Twiggs Money Flow, however, warns of medium-term selling pressure. Expect another test of 1950, but recovery above 2050 would signal an advance to 2250*.
* Target calculation: 1950 + ( 1950 – 1650 ) = 2250
Hong Kong’s Hang Seng Index is retracing after a sharp bearish divergence on 21-day Twiggs Money Flow. The longer term 13-week indicator, however, suggests no more than a secondary correction. Breach of the rising trendline, however, would warn that the trend is losing momentum.
* Target calculation: 20000 + ( 20000 – 17500 ) = 22500
The Shanghai Composite Index is retracing to test support at 2300. Failure would indicate continuation of the primary down-trend, while respect would suggest that a base is forming. A further peak below zero on 63-day Twiggs Momentum would signal another decline.
* Target calculation: 2150 – ( 2500 – 2150 ) = 1800
India’s Sensex found support at 17000. Failure would signal another test of primary support at 15000, but 13-week Twiggs Money Flow remains above zero and respect of support is more likely. Recovery above 18000 would confirm tthe primary up-trend, with a target of 21000*.
* Target calculation: 18 + ( 18 – 15 ) = 21
The NSE Nifty Index is similarly testing medium-term support at 5200. 63-Day Twiggs Momentum holding above zero indicates a primary up-trend. Respect of support at 5200, by say recovery above 5500, would confirm the signal. Failure of support is less likely, but would signal another test of 4500.
* Target calculation: 5400 + ( 5400 – 4500 ) = 6300
Singapore’s Straits Times Index twice penetrated resistance at 3000, confirming the primary up-trend, but each time retreated. Expect softness until quarter-end followed by another breakout attempt. Target for the advance is 3300*.
* Target calculation: 2900 + ( 2900 – 2500 ) = 3300
Bill Gates talks about his investment in Generation IV nuclear power.
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Dow Jones Europe Index retreated below 260, indicating a correction to test support at 247. Respect would indicate a healthy up-trend, while a fall below 240 would signal reversal. Rising 13-week Twiggs Money Flow indicates long-term buying pressure, suggesting continuation of the up-trend.
* Target calculation: 260 + ( 260 – 210 ) = 310
The FTSE 100 is also retracing to test support, at 5600. Rising 13-week Twiggs Money Flow indicates long-term buying pressure. Respect of the long-term trendline would signal continuation of the primary up-trend.
* Target calculation: 5700 + ( 5700 – 5100 ) = 6300
Canada’s TSX 60 index found strong support at 700. Rising 13-week Twiggs Money Flow signals buying pressure. Recovery above 720 would indicate a primary advance to 820*; follow-through above 730 would confirm.
* Target calculation: 720 + ( 720 – 620 ) = 820
The weekly S&P 500 chart suggests retracement to the new support level at 1370. No major deviation on 13-week Twiggs Money Flow indicates this is merely a secondary correction. Respect of 1350 would signal a primary advance. Long-term target for the breakout is 1600*.
* Target calculation: 1350 + ( 1350 – 1100 ) = 1600
Nasdaq 100 Index similarly displays a bearish divergence on 21-day Twiggs Money Flow but no major deviation on the 13-week indicator, suggesting a secondary correction to the long-term rising trendline.
* Target calculation: 2400 + ( 2400 – 2050 ) = 2750
Bellwether transport stock Fedex, however, displays a stronger bearish divergence, on 13-week Twiggs Money Flow. Failure of support at 88.00 would indicate reversal to a primary down-trend; follow-through below 86.00 would confirm. A Fedex down-trend would warn that economic activity is slowing.
Amex Gold Bugs Index, representing un-hedged gold stocks, followed through below 480, after breaking primary support at 500, confirming a primary down-trend. Peaks below the zero line on 63-day Twiggs Momentum also signal a primary down-trend. The Gold Bugs index often acts as a leading indicator of trend changes in spot gold prices. Expect further weakness in the yellow metal; breach of support at $1500/ounce would confirm a primary down-trend.
“We really are in a secular shift for greater demand for fixed income securities in Australia,” John Wilson, the head of the global bond giant’s [Pimco’s] Australia operations told Deal Journal Australia. “That’s why you will see increasing issuance in the domestic market by domestic issuers.”
“We are seeing this notably in our flows in the wealth management business. Private investors are seeking recurring income and capital stability,” he said.
In recent weeks some of Australia’s national champions–such as retailing giant Woolworths and conglomerate Wesfarmers–have issued local currency debt even as some of the country’s other big corporates have skipped local investors and borrowed elsewhere.
via Pimco Eyes Aussie Bond Boom – Deal Journal Australia – WSJ.
