After reaching a high level near 4353.00, the AUS 200 formed the resistance line of a channel down chart pattern on the 60-minute chart. The subsequent sell-off produced a prolonged move down in terms of price and time, driving the market through the down-sloping support line and completing the chart pattern.
The overall quality rating is a strong 7-bars. The initial trend, which was down at the onset of the chart pattern, posted a slightly below average 4-bars. The uniformity rating is 6-bars. This is slightly above average and indicates some equidistance between swing tops and bottoms inside of the channel. The solid 8-bar clarity rating indicates the market traded orderly and that the candlesticks were formed without any abnormal gaps or spikes. The maximum 10-bar breakout rating is the highlight of this pattern. This indicates strong downside momentum on the breakout.
The channel down chart pattern is categorized as a trending pattern. The initial trend was down so the break through support makes this a continuation move. In addition, the 4-bar rating typically indicates accumulation which is further support for the developing weakness. Based on these factors, the market is likely to reach its forecast zone at 4152.75 to 4119.51. Depending on momentum, the market may either stop here and reverse temporarily or drive through this zone to even lower levels.
Source: http://www.fxstreet.com/technical/forex-strategy/daily-index-update-technical/2011-08-05.html
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