Technicals | Apr 27 2015
By Nick Linton-Ffrost
Break above 6000 indicates 6250.Trading below 5800 implies 5500.
We suspect the two month sideways pattern in the ASX200 (XJO) will soon provide a break trade.
The upside break trade appears the more likely outcome given the medium term trend points north as well as the pattern exhibiting flat highs and slightly higher lows. Therefore a confirmed break above 6000 implies a move to 6225/6250 (height of pattern plus the break point) over a period of 2-4 weeks.
Clearly the 6000 level has been providing strong resistance. If 6000 continues to hold and the XJO trades back below 5880 we expect to see a dip back to 5800. A break under that level morphs the two month structure into a topping pattern. In that event the downside target is around 5500 (pattern height less 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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