The market is very very sick! Despite the $700 bn package been announced there isn't a single bid of respect for a rally, instead a sell off was followed immediately after the announcement.
For the coming week, there should have more bad news coming out in Europe (the weekend meeting between the big four in Europe will probably provide nothing in concrete!) We believe there should be more shocking news coming from Europe financial industries before any concrete actions will be taken by the European Union bank, which again is behind the curve in taking action.
The 3rd quarter corporate results will also kick start next week, which will definitely provide more bad news. Plus more bad news from economic data, I simply do not see any chance of rebound from here! Technically, global indexes are all very negative and should be heading for another big sell off! I am expecting a continue selling in global stock markets and the selling may turn violent by end of the week, so do be careful!
Expect Dow Jones to continue coming down and may reach 9800 by end of the week. As for STI, it will break the recent low of 2239 and may be heading to 2200- 2180 level soon.
So, good luck to those who have short positions and be alert for action for those who have no positions.
If you are a short term trader, I am sure the next two weeks will be volatile and you should have plenty of opportunities to trade. As for medium term investors, my suggestion is to stay sideline and wait for a clearer picture.
The following are the support and resistance to watch for Dow Jones, Hang Seng and Nikkei next week.
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