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Bearish divergence for US indices
By Colin Twiggs
April 1st, 2012 9:00 p.m. ET (11:00 a.m. AET)
Bearish divergence on 21-day Twiggs Money Flow warns of medium-term selling pressure on the S&P 500 index. Expect a correction to test support at 1350/1370 unless we see 21-day Twiggs Money Flow recovering above 30%.
* Target calculation: 1300 + (1300 - 1150) = 1450
The Nasdaq 100 index encountered resistance at 2800. Bearish divergence on 13-week Twiggs Money Flow over the last two weeks warns of a correction. Breach of the secondary, rising trendline would indicate a correction to the long-term trendline at 2500.
* Target calculation: 2400 + (2400 - 2050) = 2750
Bellwether transport stock Fedex warns of a double-top reversal. Longer-term bearish divergence on 13-week Twiggs Money Flow warns of strong selling pressure. Breach of support at 88 would signal a primary down-trend — and declining activity in the broader economy.
* Target calculation: 88 - (98 - 88) = 78
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