In Asia, South Korea’s Seoul Composite Index found support at 2450 but be careful of a bearish divergence forming on Twiggs Trend Index. Reversal below zero would warn of a test of primary support at 2300.
Japan’s Nikkei 225 Index remains bullish. Trend Index troughs high above zero indicate strong buying pressure.
China’s Shanghai Composite Index found support at 3250. Breakout above 3450 would signal a primary advance.
India’s NSE Nifty Index broke resistance at 10500, signaling a fresh advance. Trend Index troughs above zero signal buying pressure. The immediate target is 11000*.
Target 10500 + ( 10500 – 10000 ) = 11000
In Europe, the Footsie is advancing strongly after breaking through resistance at its June high of 7600. Trend Index is still declining but recovery above the declining trendline indicates buyers are taking control.
Europe, represented by the DJ Euro Stoxx 600, remains weak. A declining Trend Index warns of selling pressure despite breakout above resistance at 396.
Moving to the US, the S&P 500 chart says it all. Investors continue to shrug off concerns about high valuations. The rising Trend Index, high above zero, indicates strong buying pressure. We need a correction fairly soon to prevent an accelerating up-trend leading to a blow-off.
Commodities are also advancing, led by stronger crude oil prices.
It’s about time that the Fed and other central banks took the punch bowl away, before the party really gets out of hand.