World Markets Update: S&P500, Shanghai, Hang Seng, Sensex, Straits Times, Euro

Overall Outlook

Medium Term: Bearish
Short Term: Cautiously Bullish

In my humble opinion, for most markets, we've seen the highs for the medium term (except maybe Shanghai):

Believe this week is crucial for short-term direction.

S&P 500

SPX broke above bull flag, and is faltering at the downtrendline. Expecting a downwards consolidation towards 1097(staying above the blue line) on Monday, followed by an upwards breakout & grind towards the 1120 region. Around 1126, i may consider getting seriously short this market. A break below 1097, and this might be something else.

Shanghai Composite

The medium-term triangle scenario working out so far, as outlined in an earlier post. Currently, serious resistance at 3050. A break above will target 3250. A break below 2950 might change the picture. Support at 2700.

Hang Seng

As posted earlier, possible cup & handle, or in the immediate future an inverse Head & Shoulders leading towards 22000. A break above 20700 will confirm. A break below 19800 most likely invalidates. Support at 19400.

Bombay Sensex

Probably the earliest clue as to what may be coming - there was an attempted breakout above 16500 on Fri, but closed below it. If there's follow thru, expecting a rise towards 17400 followed by termination and reversal.

Straits Times

Possible break towards 2880 followed by reversal.

Euro/Usd

Although not a currency expert, expecting a reversal in the Euro, based on RSI divergence (green line)

Summary

Asian markets may offer clues as to what may be coming. Once again, correlations only last as long as they last! Highlighted above are mostly short-term bullish scenarios, if they dont materialise this week, things can get ugly.

We can speculate, but only the market is right. Watch the price action & trendlines - place your stops.

All the best!