INSIGHTS

Steven Miley

Tue, Aug 27


Equities still trying to form bottoming reversals

* A heightening and then an easing of trade wars fears since Friday has seen a spike
in volatility foe the major global stock averages.

* Aggressive selloffs Friday and into Monday have been countered by significant
rebounds as the trade war posturing between the US and China has intensified

*However, the major global indices are still trying to form intermediate-term chart
bases

*Her we focus on the German benchmark average, the DAX, which is tracing out a
potential Inverse Head & Shoulders pattern.


DAX intermediate-term “Inverse Head & Shoulders” Pattern Threat


Very volatile price action from Friday has echoed the broader, erratic tone evident through August, to establish an intermediate-term range we see defined by 11847.5 to 11480.  The extreme selloff Friday and extension lower Monday, then robust intraday rebound sets
risks higher for Tuesday.


For Today:

* We see an upside bias for 11700; break here aims for 11740.5 and 11796.5, maybe key
11847.5.

*But below 111600 opens risk down to 11544, maybe key 11480.

 

Intermediate-term Range Breakout Parameters:

*  Range seen as 11847.5 to 11480

*  Upside Risks: Above 11847.5 sets an intermediate-term bull trend to aim for 12260,
12466 and 12650.

* Downside Risks: Below 11480 sees an intermediate-term bear trend to target 11257,
10859 and 10000.

You can see more from Steve Miley, Academic Dean for the London School of Wealth Management and Kylin Prime Capital Senior Investment Advisor, here on FX Explained


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