Divergences
Chinese New Year and I am in Malaysia right now. The thing is that as long as I have my notebook, I can trade anywhere.
I really do not like using mobile devices like my hand phone or tablet to trade, it is tougher to call out tools for reading. It is always easier to use a mouse than fingers to place measurement tools.
I spoke last round about alignment between Nikkei and Dow Jones, so what do I want to talk about today?
Dow has yet to see confirmation on its MACD, nevertheless, it has also broken through the previous low, reaching further downward. While supported by the 55-week moving average last week, its climb this week is not that spectacular, resisted by both 8 and 21-week moving averages. Its next week's descend will be quite crucial, can 55-week moving average still provide a strong support or will there be a more permanent breakthrough?
Why am I bringing out Hang Seng here? Because it is also showing divergence, but in the opposite direction. Twice has Hang Seng reached lower low, but its MACD is having higher lows. As I have recalled of my earlier prediction, it possible that Hang Seng going to climb higher, at least to 55-week moving average.
Labels: divergence, Dow Jones, Hang Seng, Nikkei 225
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