11 October 2018
The US market has been hanging on the verge for the past 5 days before finally giving way to a whopping 3.15% plunge last night.
A closer look reviewed that the Dow Jones is forming a potentially "Double Top" while the German Dax has formed a "Head & Shoulders", both of which are "bearish" formations.
Where does that leave STI?
STI hit the top on 2 May this year and has been on a slow decline since. What looked like months of
"consolidation" for which I was looking for possible near term support around 3040 might be in danger of breaching at the moment, a breach of which could bring it towards 3000, if not 2500. Caution!
The STI is vulnerable to external shocks. Expect more volatility in the days ahead.
Potentially bearish Double Top forming in DJ and S&P. Whether the neckline holds remains to be seen.
Dax is on the verge of breaking down the H&S neckline and if it does, then the ball is set in motion for the bear to continue towards the 10000 level at least.
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