ASX 200 Technical Analysis: Index Finds Support at 5,200
- ASX 200 plunged after failing to hold above the 5,380 level
- Index finally found support around 5,200
- Resistance levels appear clear at 5,300 and 5,380
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The ASX 200 is trading higher today, after the index recent plunge came to a halt around the 5,200 support.
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 return to trading in that range.
The index formed what might be perceived as a bullish morning star pattern around 5,200 – potentially hinting at a run for 5,380.
With that said, resistance might be found at 5,300 in the short term, and as long as the 5,380 levels holds, pressure seems to be to the downside.
A move lower seems likely to have eyes on 5,200 for potential support while the low below 5,100 could be in focus after the index recovered from that area following Brexit.
It’s important to note that realized volatility is picking up significantly after printing its lowest levels since September 2014 (based on a 20-day ATR study).
ASX 200 Daily Chart: September 16, 2016
--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com
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