AUDJPY is a potential downside continuation pattern currently doing consolidation. At the moment, it is at support from last year’s bottom. A new 52-week low printed first quarter this year suggests further lows. Negative implications to stock indices if previous correlation is still valid.
Look at NZDJPY which has potential to fall off a cliff and make a big move. SiMSCI could have topped with a very common reversal pattern. XAUUSD is also looking toppish and could turn out to be a disappointment to gold bulls.
Exercise caution with Straits Times Index and Hang Seng Index which are both painting potential reversal chart patterns on weekly time frame.
Copper, DAX30 and FT100 show different but compelling potential bearish reversal setups. DAX30 and FT100 are loss leaders among major stock indices. Copper prices on the other hand has a positive correlation with stock indices so bearish setups in these three should be treated as confluent signals.
A look at year to date relative performance of major forex pairs and stock indices Despite high positive correlation, subsequent action following early February’s correction, separate themes are showing up as winners and losers emerge.
SiMSCI follows a 30-month cycle between late 2006 to present according to this chart. If true, local stock market is reaching a top soon followed by a bottom by end of 2018.
End of Q3 2017 (quarterly) and end of September (monthly) performance of Straits Times Index Constituents. This quarter we see Jardine Strategic replace SIA Engineering w.e.f. 18 Sep.