ASX 200 Technical Analysis: Plunge Continues as Support Fails to Hold
- Index lost the key 5,380 support level, which meant the index was back in a former range
- ASX 200 plunged after failing to hold above the level
- Potential support levels appear clear, but can the index find a bid?
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The ASX 200 is trading lower today, after plunging this past Friday upon losing the key support level at 5,380 mentioned in the last reports.
The index was trading in a well-defined range between the 5,380 resistance and the 4,750 support until July saw a breakout higher. The failure to hold above 5,380 meant a potential return to trading in that range.
At this stage, possible support levels appear clear judging by past price action, with the round numbers apparently in focus; 5,200 and 5,100 in the short term.
The low below 5,100 seems likely to be in the spotlight after the index recovered from that area following Brexit.
If buyers manage to find support, resistance may be found at 5,300 and 5,380. As long as that levels holds as resistance pressure seems to be to the downside.
It’s important to note that realized volatility is starting to pick up after printing its lowest levels since September 2014 (based on a 20-day ATR study).
ASX 200 Daily Chart: September 12, 2016
--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com
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