Dow

Dow - formed a 5 wave decline as a leading diagonal and has bounced back in 3 waves so far. A right shoulder may have formed in wave 2 and wave 3 down should be next. [hourly chart]

PNB

PNB - started larger wave 5 down to new lows. The hourly chart shows the start of wave 3 of 5 to 72.50 from the recent high of 83.20. Wave 5 of 5 should eventually carry below 69.

​​​​​​​5=1 on the daily chart falling channel points to 64.

Remember that most PSU banks have a Multi year Head and Shoulders pattern and some have already broken the neckline. PNB monthly chart below shows the picture. Here the shoulder measurement target is itself near 36. Head measurement would be 23. And the case is similar accross PSU Banks where the bear market is not yet over. The final leg down will occur as they are forced to recapitalise which means the equity will bloat relative to earnings and thus the price adjustment. Or maybe they will be sold off to a buyer at a discount. Either way the chart points down.

Hang Seng Index

Hang Kong is among the first few markets leading lower in Asia. The index has fallen below both the daily and weekly swing lows starting minor wave iii in the short term. The weekly chart below shows that the rise was wave 2 [in 3 waves], and ended at the 40wema, so wave 3 down has started from there and should see new 2016 lows in the coming months.

Dow Transports

Dow Transports - was yesterday weakest US index as it broke the previous swing low on daily charts. The weekly chart below shows the start of wave 3 down for the larger bear market from the 61.8% mark and a break below the 40wema. The lower tops and bottoms indicate an ongoing downward trend.

Euro

The hourly chart of the Euro shows a clear 5 wave decline to yesterday's low. This confirms that the trend is clearly down in the Euro. All you may get is a minor wave 2 up and then more selling.

Copper

Copper broke it weekly swing low and is starting to look like a new leg to new lows. The weekly momentum is also likely to roll over. The lower Bollinger band at 1.94 would be the first major support. But if that breaks then we would have to consider channel targets. c=a is at 2.04 so that wold be the first level to consider that the move down can pause, or extend.

Dow Gold and Dollar

This inter market relationship will be important in the year ahead as I do believe that Gold made a long term bottom. This chart of the 3 from 2000-2001 gives you some perspective. Gold made its first rally in 1999 and after that spent a full year in wave 2 down. That was at the start of the last bull market in gold. In remained in a retracement for a year as the dollar was still rising to new highs and the Tech bubble was imploding. Today as Gold has rallied and is now correcting a bit the dollar is again raising its head and I wonder how long we could be in a correction for gold. The rise of the dollar would be in its final stages and will have to be watched for the next trend reversal. Hopefully it will not go on for the rest of the year but who knows.

Jakarta Composite

Jakarta fell in 2015 in 5 waves and has been in wave B up for months. At 61.8% retracement this is complete. The Jakarta Composite is starting wave C down to 3632.

USDCNY

The Chinese Yuan broke out of a triangular decline [pennant] and is heading higher. The best alternate wave count is this one as prices remain within the rising channel. The next move up in wave 5 of 3 [circle] has started and 5=1 is near 6.63 and the upper channel line is at 6.75. In other words wave 3 up continues in a rising channel with the lower channel line support at 6.48