Interesting charts October 7th 2014
German Mid Cap Index – held a progression of higher reaction lows between late 2011 and July. The Index posted a failed upside break in May, dropped below the 200-day MA for the first time in nearly three years in July and posted its first lower high in September. A sustained move above 16,500 will be required to question Type-2 top formation completion characteristics as taught at The Chart Seminar.
South Korea – failed to hold the breakout to new three-year highs and is returning to test the progression of higher reaction lows evident since 2011. A clear upward dynamic will be required to check momentum, pressure shorts and indicate a return to demand dominance.
FTSE350 Pharmaceutical & Biotechnology Index – The progression of higher reaction lows remains intact but a loss of momentum is evident and the sector is no longer posting new highs. It will need to continue to find support above 12000 if potential for continued higher to lateral ranging is to be given the benefit of the doubt. It is also worth highlighting that as one clicks through the FTSE350 sectors, the breadth of the market has contracted considerably.
