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ASX200: Possible Pullback

Technicals | Jul 25 2016

By Nick Linton-Ffrost

Pullback from 5550-5600 expected before another leg up towards 6000

We suspect that the ASX200 (XJO) is trading in the 5th wave up from 4700 which implies a near term top should form between 5550 and 5600 over the 10-15 days.

Our view is based on the assumption that 5500/5600 is a target “achievement level” derived from the break at 5300 and where wave ‘5’ = ‘1’. At times these target achievement levels can create reversal points.

If a pull back does occur we will expecting it to take around 3-4 weeks and marking it as a near term correction within our medium term bullish count. Our medium term view assumes that the drop from 6000 to 4750 was a major (4) which implies the market is trading within a major (5) towards the 6000 line break target (i.e. height of 10 mth trend channel added to the 5150/5200 break point).

Another trading idea from

Fifth Wave | fwtc.com.au                                               

FW generates over 150 Trading Alerts on the ASX100 each year. We are a subscription service specialising in short term technical strategies based on 27 years experience.

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