Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
AI Mega-trend Tech Stocks Buying Levels Q2 2020 - 1st Jun 20
M2 Velocity Collapses – Could A Bottom In Capital Velocity Be Setting Up? - 1st Jun 20
The Inflation–Deflation Conundrum - 1st Jun 20
AMD 3900XT, 3800XT, 3600XT Refresh Means Zen 3 4000 AMD CPU's Delayed for 5nm Until 2021? - 1st Jun 20
Why Multi-Asset Brokers Like are the Future of Trading - 1st Jun 20
Will Fed‘s Cap On Interest Rates Trigger Gold’s Rally? - 30th May
Is Stock Market Setting Up for a Blow-Off Top? - 29th May 20
Strong Signs In The Mobile Gaming Market - 29th May 20
Last Clap for NHS and Carers, Sheffield UK - 29th May 20
The AI Mega-trend Stocks Investing - When to Sell? - 28th May 20
Trump vs. Biden: What’s at Stake for Precious Metals Investors? - 28th May 20
Stocks: What to Make of the Day-Trading Frenzy - 28th May 20
Why You’ll Never Get Another Stimulus Check - 28th May 20
Implications for Gold – 2007-9 Great Recession vs. 2020 Coronavirus Crisis - 28th May 20
Ray Dalio Suggests USA Is Entering A Period Of Economic Decline And New World Order - 28th May 20
Europe’s Coronavirus Pandemic Dilemma - 28th May 20
I Can't Pay My Payday Loans What Will Happen - 28th May 20
Predictive Modeling Suggests US Stock Markets 12% Over Valued - 27th May 20
Why Stocks Bear Market Rallies Are So Tricky - 27th May 20
Precious Metals Hit Resistance - 27th May 20
Crude Oil Cuts Get Another Saudi Boost as Oil Demand Begins to Show Signs of Life - 27th May 20
Where the Markets are heading after COVID-19? - 27th May 20
Silver Springboards Higher – What’s Next? - 26th May 20
Stock Market Key Resistance Breakout Is Where the Rubber Meets the Road - 26th May 20
5 Ways To Amp Up Your CFD Trading Today - 26th May 20
The Anatomy of a Gold Stock Bull Market - 26th May 20
Stock Market Critical Price Level Could Soon Prompt A Big Move - 25th May 20
Will Powell Decouple Gold from the Stock Market? - 25th May 20
How Muslims Celebrated EID in Lockdown Britain 2020 - UK - 25th May 20
Stock Market Topping Behavior - 24th May 20
Fed Action Accelerates Boom-Bust Cycle; Not A Virus Crisis - 23rd May 20
Gold Silver Miners and Stocks (after a quick drop) Ready to Explode - 23rd May 20
3 Ways to Prepare Financially for Retirement - 23rd May 20
4 Essential Car Trade-In Tips To Get The Best Value - 23rd May 20
Budgie Heaven at Bird Land - 23rd May 20
China’s ‘Two Sessions’ herald Rebound of Economy - 22nd May 20
Signs Of Long Term Devaluation US Real Estate - 22nd May 20
Reading the Tea Leaves of Gold’s Upcoming Move - 22nd May 20
Gold, Silver, Mining Stocks Teeter On The Brink Of A Breakout - 21st May 20
Another Bank Bailout Under Cover of a Virus - 21st May 20
Do No Credit Check Loans Online Instant Approval Options Actually Exist? - 21st May 20
An Eye-Opening Perspective: Emerging Markets and Epidemics - 21st May 20
US Housing Market Covid-19 Crisis - 21st May 20
The Coronavirus Just Hit the “Fast-Forward” Button on These Three Industries - 21st May 20
AMD Zen 3 Ryzen 9 4950x Intel Destroying 24 core 48 thread Processor? - 21st May 20
Dow Stock Market Trend Analysis and Forecast - 20th May 20
The Credit Markets Gave Their Nod to the S&P 500 Upswing - 20th May 20
Where to get proper HGH treatment in USA - 20th May 20
Silver Is Ensured A Prosperous 2020 Thanks To The Fed - 20th May 20
It’s Not Only Palladium That You Better Listen To - 20th May 20
DJIA Stock Market Technical Trend Analysis - 19th May 20
US Real Estate Showing Signs Of Covid19 Collateral Damage - 19th May 20
Gold Stocks Fundamental Indicators - 19th May 20
Why This Wave is Usually a Market Downturn's Most Wicked - 19th May 20
Gold Mining Stocks Flip from Losses to 5x Leveraged Gains! - 19th May 20
Silver Price Begins To Accelerate Higher Faster Than Gold - 19th May 20
Gold Will Soar Soon; World Now Faces 'Monetary Armageddon' - 19th May 20

Market Oracle FREE Newsletter


Global Stock Markets Outlook Ahead

Stock-Markets / Global Stock Markets May 21, 2012 - 08:20 AM GMT

By: Sam_Chee_Kong


Diamond Rated - Best Financial Markets Analysis ArticleFor the past week, stock markets around the globe can best be describe as ‘looks like 2008’ about to be replay. Most markets are loosing ground and in fact most recent lows are being tested or broken.  In line with most of our analysis for the week ending 19th of May 2012, most markets are facing a freefall. Below is the Executive Summary for this week’s analysis of selected markets around the globe. This analysis is purely based on technical analysis and also partly with the use of spectral analysis.

We use Spectral Analysis to help us analyze both the stationary and non stationary part of the stock prices. Traditional methods of using indicators and oscillators can only be used to predict the stationary part of the share price. This is because in normal market conditions share prices don’t move together but during markets crashes most if not all stocks will go down together. Hence there is a need to study this non stationary part of the stock prices with other methods and  in this case with spectral analysis which can give a better timing on market movements.

Anyway Spectral Analysis had long been used by geologists to estimate the amount of oil in an oilfield during exploration with great precision.Another advantage of using Spectral Analysis is that it needed only limited data to predict an outcome with great precision. Unlike Fourier Transform you will need at least 10-15 years of historical data to arrive at some accuracy in its prediction.

Let take a look at the following markets.

America – Dow Jones

What we can see is the Dow is in oversold condition and further drop will be capped and a rebound in stock prices is on the way next week. Nevertheless the Dow is just at the beginning of the down trend. More room to fall.The next level to test will be 11735.

Europe – Germany DAX

The DAX is quite similar to the DOW which is also in oversold condition and further drop will be capped and a rebound in stock prices is on the way next week. Nevertheless the DAX  is just at the beginning of the down trend. We expect more room to fall. The next level to test will be 5845

ASIA – Jakarta

The bad news about the Jakarta Stock Exchange is that is closed for the last two trading days in the last week due to public holidays. When the market opens on Monday, we expect the IHSG index to dive between 80-150 points so as to make up for the two days losses. Nevertheless it will test the 3839 level next week.

ASIA – Kuala Lumpur KLCI

Kuala Lumpur’s Composite index’s fall will be capped by the following.

  1. Oversold condition
  2. Positive Divergence in RSI

So we expect the KLCI to stage a rebound next week with limited downside.

ASIA – Japan Nikkei

Since it broke the 9390 level in early May, it has been free falling. Chances is that it might test the 8275 level before it will rebound. Oversold condition also help prevent further fall in the Nikkei and we expect a rebound in the Nikkei next week.

ASIA – Bombay Sensex

We expect the Bombay Sensex to rebound soon next week as it is already in an oversold condition with a double bottom forming in the RSI  indicator. After that we expect to see it to test the next support at the 15135 level.

ASIA – Hong Kong Hangseng

As expected with our earlier analysis, Hong Kong’s Hang Seng will free fall after it broke the 20,000 support level. The good thing is that the market is in oversold condition but further drop to be expected before any meaningful rebound can be expected.

Nevertheless the next support waiting to be tested is at the 17615 level.

ASIA – Singapore Straits Times

There is a big gap down in the last trading day and we will expect the index will rebound to this level. Market is highly oversold and it is screaming for a rebound next week not before another drop.

ASIA – Shanghai

We expect the Shanghai index to test the 2333 support level. Any breakdown will see the SSE to display further weakness. The danger on the SSE is that its RSI is Dverging, meaning further big drop in he index is expected soon.

South America – Brazil’s Bovespa

In line with our earlier prediction, after breaking the second support level at 61195, the Bovespa  indeed free fall very hard. It manage to wipe out another 6000 points but it is highly oversold and we expect it to stage a rebound next week.

So all in all, Global Stock Markets performed badly for the week ending 20th May 2012 but most markets are already in oversold conditions. This means we expect to see a rebound in global stock prices in the later part of next week. 


The only market that we expect to see a big dive is the Indonesian IHSG as it escaped two days of carnage and hence it will have to make up for the losses next week.

by Sam Chee Kong

    © 2012 Copyright  Sam Chee Kong - All Rights Reserved

    Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules