Our resident expert chartist has decided to contribute her thoughts on the recent market drop, she seems to think things may continue to decline…enjoy!
I am digging for the possible downside of the SET index in this current decline.
While this chart may look confusing to many, it is actually very simple.
First, look at the black trend lines. The SET index has retreated from this monthly resistance line, of which its parallel lines previously signal significant declines. One of the largest decline occurred at the parallel line of this black resistance line but not draw in this chart though, includes the pre-Subprime Crisis period.
So, yes, we are at the significant juncture.
Keep in mind that, the decline at this resistance line doesn’t have to be GFC-sized large; it can be much smaller, 100 points decline, perhaps?
All the red trend lines show the pattern of the SET index I am watching now. Note that these are not based on Fibonacci.
I am watching the support level at 1,380-1,370. That’s the first downside I see.
Am I pessimistic? No, that’s my optimistic downside.
I have another scenario in mind: the SET index may swing within this red-blue channel, ranging within 400-550 points, for a year or two, before something triggers a deep, deep plunge —– the pattern we saw pre-Subprime.
That’d be one of the nightmares. But for now, let that scenario be just that – a really bad dream.