The Brazilian BOVESPA index is headed for another test of 48000. Reversal of 13-week Twiggs Money Flow below zero warns of further selling pressure. Failure of support would signal a down-swing to 38000*.
* Target calculation: 48 – ( 58 – 48 ) = 38
South Africa’s JSE Overall Index fared better than most but is likely to be dragged lower by the global bear market. Expect a test of support at 28400; failure would signal a decline to 26000*.
* Target calculation: 28.5 – ( 31 – 28.5 ) = 26
The SENSEX is headed for another test of support at 16000. 13-Week Twiggs Money Flow holding below zero indicates a strong primary down-trend. Failure of support is likely and would indicate a down-swing to 14500*.
* Target calculation: 16000 – ( 17500 – 16000 ) = 14500
Singapore’s Straits Times Index has already broken support at 2650, warning of a down-swing to 2300*. 63-Day Momentum declining while below zero also confirms a strong primary down-trend.
* Target calculation: 2600 – ( 2900 – 2600 ) = 2300
The FTSE 100 is testing support at 5000. Failure would warn of a down-swing to 4400*, but long tails and rising 21-day Twiggs Money Flow indicate medium-term buying pressure. Respect of support is likely and would continue the line between 5000 and 5450.
* Target calculation: 5000 – ( 5600 – 5000 ) = 4400
Germany’s DAX index displays similar medium-term buying pressure on 21-day Twiggs Money Flow. Respect of support at 5000 is likely and recovery above 5700 would indicate another bear rally.
* Target calculation: 5000 – ( 6000 – 5000 ) = 4000
Transport bellwether Fedex respected resistance at $70, signaling a down-swing to $55*. 13-week Twiggs Money Flow declining below zero indicates a strong primary down-trend. UPS (lime green) is also in a primary down-trend; reversal below its August low would confirm the Fedex bear signal. Declining transport stocks warn of shrinking activity levels in the overall economy.
* Target calculation: 70 – ( 85 – 70 ) = 55
Dow Jones Industrial Average is testing the band of support between 10600 and 10800. An up-tick in volume indicates some buying support but this appears insufficient to withstand downward pressure. Failure of support at 10600 is likely and would signal a primary decline to 10000*.
* Target calculation: 11000 – (12000 – 11000 ) = 10000
The S&P 500 index is similarly testing support at 1100, while 21-day Twiggs Money Flow declining below zero warns of selling pressure. Breach of 1100 would signal a primary decline to 950*.
* Target calculation: 1100 – ( 1250 – 1100 ) = 950
The NASDAQ 100 is headed for a test of support at 2040. Reversal of 13-week Twiggs Money Flow below zero warns of a primary down-trend. Breach of support would signal another decline with a target of 1700*.
* Target calculation: 2000 – ( 2300 – 2000 ) = 1700
The raging recession in Australian manufacturing is worsening. The PMI dropped to a new cycle low, having been in effective recession for over a year.
The internals of the survey are very nasty. 10 out of 12 sectors are shrinking…..
via Manufacturing is getting murdered – macrobusiness.com.au | macrobusiness.com.au.
Bundestag president Norbert Lammert said yesterday, lawmakers had a nasty feeling that they had been “bounced” into backing far-reaching demands. This can never be allowed to happen again. He warned too that Germany’s legislature would not give up its fiscal sovereignty to any EU body.
…..Something profound has changed. Germans have begun to sense that the preservation of their own democracy and rule of law is in conflict with demands from Europe. They must choose one or the other.
via NEIN, NEIN, NEIN, and the death of EU Fiscal Union – Telegraph Blogs.
The combined assets of the nation’s mutual funds decreased by $398.0 billion, or 3.3 percent, to $11.621 trillion in August, according to the Investment Company Institute’s official survey of the mutual fund industry.
via ICI – Trends in Mutual Fund Investing, August 2011.
Stock funds decreased by 7.4% in August 2011 but were offset to some extent by gains in money market funds.
According to [Boston Consulting Group], the amount of developed world debt between household, corporate and government that needs to be eliminated is just over $21 trillion. Which unfortunately means that there is an equity shortfall that will have to be funded with incremental cash which will have to come from somewhere.
German Chancellor Angela Merkel’s fractious coalition won a brief reprieve on Thursday, as lawmakers from the center-right ruling parties closed ranks and passed legislation to expand the euro-zone’s bailout fund.
……A total of 523 lawmakers voted in favor of the EFSF reform bill; 85 voted against, with three abstentions. The overall result includes the votes of the opposition Social Democrats and the environmentalist Greens, who unanimously backed the bill in stark contrast to Ms. Merkel’s unruly coalition.
……The 17 euro-zone governments agreed in March and July to expand and reform the EFSF, boosting the lending capacity of the fund to €440 billion ($596 billion) from €250 billion. The fund also will receive additional powers, such as the ability to extend credit lines to banks and buy bonds on the secondary market.
…….The temporary EFSF is set to expire in 2013 and to be replaced by a permanent European Stability Mechanism.
