East to West: China sell-off

Four markets worth our attention this week:

China’s Shanghai Composite Index displays strong selling pressure, testing medium-term support at 3340. Breach of support is likely and would warn of a strong correction, with an immediate target of 3200.

Shanghai Composite Index

India’s NSE Nifty Index displays strong support at 10000. Recovery above 10500 would signal an advance to 11000.

Nifty Index

Target 10000 + ( 10000 – 9000 ) = 11000

Moving to Europe, Dow Jones Euro Stoxx 600 found medium-term support at 380. Bearish divergence on the Trend Index warns of selling pressure. Breach of support at 380 would be a strong bear signal but respect of the rising trendline is more likely and recovery above the recent high would signal a fresh advance.

DJ Euro Stoxx 600

The UK’s Footsie found support at 7350 but bearish divergence on the Trend Index warns of long-term selling pressure. Breakout above 7550 is unlikely at this stage.

FTSE 100

2 thoughts on “East to West: China sell-off

  1. Murray Cooper says:

    Hello Colin,
    There appears some serious divergence on the above charts with your new indicator … scary.
    I further note you used your older Money Flow on your S&P500 & FedEx post …
    … and the Trend Index on the AXJO presumably is flat negative.
    Do you think we may see a sell off in late Jan?
    My cyclic analysis on the S&P500 is calling for an intermediate low to form circa 20 Dec and a major low to form circa 10 Jan with targets of 63,51 and 07 …. just for the record.
    Perhaps not quite the Christmas rally we are hoping for …
    A usual, high regard for your analysis and insight
    Regards
    Murray

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