The MSCI Asia Apex Index combines 50 of the largest stocks in Hong Kong, Taiwan and Korea. The following Elliott wave development in the index provided Elliott Wave International's Asian-Pacific Short Term Update Editor Chris Carolan an opportunity to show his readers how he uses three of his favorite technical indicators to anticipate trend changes.
Chris's primary tool for spotting trend reversals is the Wave Principle. It was wave analysis that suggested prices of Asia's 50 largest stocks were about to fall as the five-wave impulse structure (see chart above) was nearing completion. But to confirm his view, Chris also used these three indicators. (He shows you the details of his technique in the trading course.)
1. Relative Strength Index (RSI) noted a divergence with the MSCI Asia Apex Index price: As the price moved higher, the RSI moved lower.
2. Digital Signal Filter (Jurik RSX), an enhanced RSI, was at the top of its range.
3. Prices breached the Keltner Channel (dotted brown line).
And here's what happened after Chris's forecast:
You can learn the complete details of Chris's forecasting technique in his 42-minute on-demand, online trading course "3 Technical Indicators to Help You Ride the Elliott Wave Trend." You will learn how to get the most out of each of these indicators using detailed charts of real-world examples.
(Already a subscriber to the Asian-Pacific Short Term Update, European Short Term Update or Global Market Perspective? View the trading course here.)
Jurik RSX is courtesy Jurik Research