Typically I only trade the major stock indices when I can see a big move happening. This is because they are dictated by many individual stocks which of course can be influenced by a multitude of factors, so its very easy to get caught on the wrong side of an unexpected move.
The great thing with major indices however is that they do serve as great reflections of the economy as a whole. Most if not all esteemed economists are predicting that 2019/2020 will see the next recession. I won't go into the reasons for this, simply because I don't have all the research myself and also I don't have the time. Simply put, my bias on all of the major indices is bearish.
So when now assessing the price action we have seen develop over the past 12 months you can see this time last year saw a major rally into the 7900 region where we saw the 2018 high. Then throughout the majority of the year price was ranging above 7500 and below 7800 before we started to see the cracks emerge in the global stock market. Ever since price broke the 7500 barrier we have seen a major sell off, verging on official bear market conditions in some sectors. There was some temporary support of 7200 which has become a major Swing Level in the market but this got viciously broken in early October and as winter 2018 set in we only saw the market sell off even more. Even breaking the 7000 level!
More recently since 2019 price has recovered above 7000 but still has not broken above the 7200 Key Swing Level mentioned previously. As I stated this level has become such a barrier because not only term of technical analysis has it created a resistance level and key swing level for price but also because price has never broken it since the widespread concerns within the global stock market come to the fore.
So I am opening some short positions around this zone and will be targeting 7100 as a safe target that still leaves room for the market to range between 7000 and 7200.
The great thing with major indices however is that they do serve as great reflections of the economy as a whole. Most if not all esteemed economists are predicting that 2019/2020 will see the next recession. I won't go into the reasons for this, simply because I don't have all the research myself and also I don't have the time. Simply put, my bias on all of the major indices is bearish.
So when now assessing the price action we have seen develop over the past 12 months you can see this time last year saw a major rally into the 7900 region where we saw the 2018 high. Then throughout the majority of the year price was ranging above 7500 and below 7800 before we started to see the cracks emerge in the global stock market. Ever since price broke the 7500 barrier we have seen a major sell off, verging on official bear market conditions in some sectors. There was some temporary support of 7200 which has become a major Swing Level in the market but this got viciously broken in early October and as winter 2018 set in we only saw the market sell off even more. Even breaking the 7000 level!
More recently since 2019 price has recovered above 7000 but still has not broken above the 7200 Key Swing Level mentioned previously. As I stated this level has become such a barrier because not only term of technical analysis has it created a resistance level and key swing level for price but also because price has never broken it since the widespread concerns within the global stock market come to the fore.
So I am opening some short positions around this zone and will be targeting 7100 as a safe target that still leaves room for the market to range between 7000 and 7200.