AEX short term update

So what’s up? It’s pretty clear by now that the peak (May 28th) is in. The decline is steep and currently oversold. I’m not a fan of overbought/oversold indicators, since they can stay in an extreme for a long time. But the modified Stochastic from Walt Bressert does a pretty good job of pinpointing highs and lows. In the chart itself we see the AEX is entering a region of support (red). There also appears to be a slight divergence in the Stochastic. Volume however is up, indicating that the low is not in. The full ‘super’ Moon might help as well.

Once the AEX bounces, it might form what looks like a right shoulder of a S-H-S pattern.

Nothing more to add at this point, but to see how the pattern develops over the next few days.