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The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
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* If the dots don't connect, gather more dots until they do...or, just follow the $$$...

Art Deco Xmas Lady

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Tuesday, October 08, 2019

Canada's TSX Target Nearly Tagged

In my post of September 14, I had identified a Fibonacci target price of 16,972.52 for Canada's TSX Index. At the time, its price was $16,682.42.

It, subsequently, hit an all-time high of 16,947.23 on September 20 and has been in decline ever since, as shown on the following monthly chart.

The Balance of Power has shifted swiftly and sharply to sellers and has reached the extreme level in just two weeks. Historically, this level has signalled either the beginning of much more selling ahead, or a point of exhaustion and reversal.

With Canada's Federal election coming up on October 21, we may see this index slide further until then. If either a minority Liberal or Conservative government is elected, I think we'll see a further drop to around 15,600, or lower. After hearing a few political analysts comment on last night's (Monday) party leadership debate, I think that scenario is possible. Public support for the Liberal and Conservative parties is fairly evenly divided at the moment and we may see the NDP party gain enough support to thwart a majority government by either party.

Where the TSX Index goes from that date is anybody's guess...so keep an eye on the Balance of Power indicator for possible clues.