- New Science in old markets -

US equities weekly compression, Australia makes a top

We have been pointing out compressions in US equity indices at a daily scale for some time. Now we have seen a weekly-scale version, in the New York Stock Exchange Composite index. This is one of the bigger indices and so warns that the whole market is poised for a new move. As ever when a compression signal arrives we cannot tell which way it will break - either up or down- but we can tell that the break is imminent. In the case of weekly compressions that means 'any week now' so we are in a state of moderate alert. Big moves happen after weekly compressions so now would be a good time to review portfolios and make contingency plans. The chart:

NYSE weekly comp

Elsewhere, the main Australian index has made a couple of top extensions at a daily scale recently. We advised buying this in the 26th January edition - shown at the blue arrow in the chart - and took partial profits on that long position based on our usual trading rules two days ago on the 9th February. We would now sell the remaining other half to go 'flat':

Australia top ext