Bear Alert

by Gary Glover

False Breaks everywhere we look.
In the last two nights we have had a false break on four of the largest  Equity indices globally. The Dow Jones Industrials, S&P 500, FTSE and Dax have all marked marginal new highs in the past few days and have failed to kick on leaving a marginal new high that has failed to kick on on our daily charts. Seeing a weekly close is a stronger signal so we will have to see how the week ends but fast moves often follow false breaks so we need to be on our toes here as potentially we are seeing some universal sell signals present across many of the key indices simultaneously.

Marginal new highs on weekly set up suggests that the market has failed to push on after breaking to a new high.  Once traders see that the market can't kick on it often turns the other way sharply.  Novice traders often buy the breakout and hence get caught here as it turns sharply the other way.  It's then a scramble to get out as it falls back the other way.


Gary Glover is an Authorised Representative (Rep No. 259215) of Novus Capital Limited ("Novus"). Novus is a holder of Australian Financial Services Licence No 238 168. Novus, its directors, officers, associates and employees each declare that they, from time to time, may hold interests in financial products and/or earn brokerage, commission, fees or other benefits from financial products mentioned in this e-mail or attached documents. Unless specifically stated within this page or an attached document, any information communicated by this e-mail constitutes unsolicited general financial product advice which has been compiled without regard to any investor's individual objectives, financial situation or needs. It is not specific advice for any particular investor. Before making any decision about the information provided, you need to consider the appropriateness of this information having regard to your individual objectives, financial situation and needs and consult your adviser. Any indicative information and assumptions used here are summarised and also may change without notice to you, particularly if based on past performance or relate to a future matter.

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