News & Analysis
Eightcap CFD technical insights: AUS200 building to a possible leg lower?
Easing trade fears sent the Dow Jones and S&P500 new all-time highs in last night’s session (20/9) this capped off two strong previous sessions. Markets moved back to risk after reports showed new tariffs were not as bad as had been expected.
But this good news failed to move over to the local ASX200. The US30 CFD that tracks the Dow Jones added 640 pts in three sessions while the AUS200 which tracks the ASX200 has lagged. Which starts to set up some concern that buyers don’t look very interested at the moment.
Looking at the daily AUS200 chart we can see technical signs price remains weak and could be at risk making a new decline if further pressure develops.
The first thing that jumps out is the break of the long-term trend line. The decline was very sharp dropping 260+ points in 7 lower sessions. The current counter rally is shallow and has formed a triangle pattern which can be seen as continuation in nature due to the preceding decline. Resistance remains failed high is it remains below 6200. A new break lower could confirm the continuation pattern, possibly setting up a new leg lower. Bulls will be looking for a strong close above 6200 to break resistance and confirm a continuation of the current counter-rally.
Good Trading from Eightcap.
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