Are we looking at the next 20-30% drop in the stock market?
First of all, this is not to cause alarm but to look at the JPY chart from a holistic long term view.
The last time we posted about a market drop, it came true. This chart is a summary of how we called the DJIA to fall from 35,200 to 29,000.
This was also followed up with a posting on the SPX from 4200 to 3700.
Looking at the long term view of all the YEN pair, we are seeing massive reversal signs on weekly chart. When YEN strengthens, the stock market falls as risk off sentiment comes back.
This will be analyzed looking at the AUDJPY. The pair just completed a Head and Shoulders and it is poised delicately.
If it can go above 97 and close strong, we will see the markets go up and the pattern is over.
However what is more likely to happen is that the AUDJPY will start dropping down due to the shoulders at 95.80 and head at 97. The first level is 90.32 and then to 87.20. The drop in the AUDJPY is going to be corresponding to the drop in the indexes.
How long will this take? I believe it will be a slow grind down. This level is likely to be reached in about October to December timeframe.
Would love to hear your thoughts and comments. Cheers
The last time we posted about a market drop, it came true. This chart is a summary of how we called the DJIA to fall from 35,200 to 29,000.
This was also followed up with a posting on the SPX from 4200 to 3700.
Looking at the long term view of all the YEN pair, we are seeing massive reversal signs on weekly chart. When YEN strengthens, the stock market falls as risk off sentiment comes back.
This will be analyzed looking at the AUDJPY. The pair just completed a Head and Shoulders and it is poised delicately.
If it can go above 97 and close strong, we will see the markets go up and the pattern is over.
However what is more likely to happen is that the AUDJPY will start dropping down due to the shoulders at 95.80 and head at 97. The first level is 90.32 and then to 87.20. The drop in the AUDJPY is going to be corresponding to the drop in the indexes.
How long will this take? I believe it will be a slow grind down. This level is likely to be reached in about October to December timeframe.
Would love to hear your thoughts and comments. Cheers
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