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End stage trading is fraught with difficulty!


Mercury

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I believe we are in the final phase of the Central bank inspired bull market.  If correct we ought to see some fairly wild swings and choppy trading conditions as Bears start to exert themselves and perma-bulls continue to deploy the strategies that have worked so well thus far (buying the dips).   We have certainly seem some whipsaw action on the Nasdaq of late and I believe the Nasdaq is the one to watch (plus the SP500 of course, which is the biggest market of them all).  The breakdown in Indices towards the end of last week is cause to consider a bearish move for a while but is that correct?  Another sign of end of a major trend is divergence between various markets, which have been is lockstep heretofore.

Certainly the set up from a technical charting point of view seems Bearish in the short term on SP500 and Dow, although there was a bounce relief rally at the end of Friday off short term support (a bullish sign).  If we look at the Nasdaq and FTSE100 however I see something different.  As I mentioned in my FTSE post on Friday I saw a road-map that contained either a new Wave 4 on long term supporting trend-line (purple line) or a retest of the blue tram-line break out zone, which we got on Friday.  If this holds (possible with another test or two next week) then that will conclude a 1-2 retrace at the Fib 76/78% level and herald a wave 3 rally to fresh all time highs, possible around 7900 level before another retrace and final push to the top around 8000 (levels are speculative at this point of course).  Note also that I don't see a NMD on FTSE, which I'd really need to see to call a major turn.  As this was my original set up I am naturally drawn to it but Dow and SP500 set ups seem more bearish.  The Nasdaq however also looks like it may have retraced to a turn with a strongly bullish pin bar off a lower parallel tram-line (blue lines).  Both these moves (FTSE and Nasdaq) are currently showing in A-B-C format (a retrace).

So at present I see Bearishness on SP500 and Dow and Bullishness on FTSE and Nasdaq.  Will they diverge or will something else happen?  Dunno but trading indices over the next month or so could prove very tricky indeed if he end truly is nigh...  I might prefer to focus on the cleaner set ups on FX until things become a bit clearer.  The only one I am tempted by is the FTSE, especially if we see another test or two of the Fib 76/78% and rally away.

As even want to hear what others think so please comment, otherwise what is the forum for?

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