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Large triangles on stock indices and major currency pairs: big moves coming

Stock indices in Asia and major currency pairs are closing in on the conclusions of large triangles that have been in formation since around 2008.
 
Hang Seng:  

 

Shanghai Composite: 

 

Source: Yahoo Finance
 
Nikkei: 

 

Australian index: 

 

Are these indices lagging the West and about to break out upwards? Or have Western indices begun a topping process which will be accompanied by a breakdown in Eastern indices?
 

 
We see a similar formation behind the scenes of the S&P500 action, looking at market breadth: 

 

Source: Astrocycle / Stockcharts
 
The Mclellan oscillator typically produces a positive or negative divergence ahead of a move in the stock market. It has been teasing us for some time by narrowing in its range, but keep an eye on it for a lead move, breaking one way or the other. 
 

 
Turning to the major currency pairs, and relations between USD, GBP and USD:
 
Euro / GBP: 

 

Euro / USD: 

 

GBP / USD: 

 

Breakout against the dollar? Is the big move coming to be a breakdown of the US dollar, associated with a breakout for long term treasury yields and a big move up in gold? 

 

Source: Yahoo Finance 

 

Source: Gold Scents
 

In all the above scenarios, a safe strategy is to await a breakout, then a successful backtest of the breakout (to ensure it is not a fakeout), before trading in the direction of the breakout.

John Hampson, UK / Self-taught full-time trading at the global macro level / Future Studies / www.amalgamator.co.uk / Forecasting By Amalgamation



Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.