Trading Day: Dead cat falling

The S&P/ASX 200 is down 30 points or 0.65% at midday, continuing the broad correction since mid-April. Asian markets are down, the Nikkei 0.36%, the Hang Seng down 0.58% and Singapore 0.3%, following the US market drop overnight. The AUD is dicing with 1.05 against the USD, whilst gold is rising at $1524 USD an ounce and WTI oil steady at $98.83 USD per barrel.

Daily charts show the correction is now at the crucial 4600 points level, with the hourly charts showing this is slipping, with the overall trend bearish. If prices close below this level, the next target level is 4500 points, for a near 10% overall correction in prices since the April high.

As I mentioned yesterday, this puts this current move beyond a dip and into the likes of the May 2010 Greece correction and February 2011 MENA/Japanese corrections, each of which saw falls of 15% and 10% respectively.

H/T to Avid Chartist for this great hourly chart:

Hourly chart from Avid Chartist - notice trend channel break

Equity and risk markets remain very weak and may fall further on any bad news – likely to emanate from Europe first and foremost.

Daily chart showing trend channel and support (?) at 4500 points

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