Market Comments. 27/5/2010

Technically, nothing much has changed today. The market (XAO) is in a sideways consolidation. These can break either way - but given the current trend - the most likely movement is downwards.

The ADX is still pointed upwards and indicated that the market is in a strong trend - downwards. Any further movement upwards in the market is likely to be short lived before it resumes its downward trajectory.

The RSI is still below 50 which is bearish.

The MACD is close to a positive crossover. If that occurs we will probably get some upward movement in the XAO but any upward movement is likely to be short lived. Traders, in my opinion, should be selling any significant rally.

Looking at the Slow Stochastic, it is heading upwards while the market is heading sideways. A cross below its signal line would signal a resumption of the down trend.

Cheers

Red