Could be a slippery slide lower on the ASX

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The ASX200 is under pressure as price falls into the weekend on stock market meltdown fears. US rate rises and inflation, along with other concerns, are weighing on bullish sentiment and testing the patients of buyers. Is this the calm before the inevitable storm?

To me, the 7140 level is the line in the sand after the recent RTF (Double Top) at 7640, and buyers will need to hold the line if we are to see higher prices. Price has extended into the level so may see a bounce on some bargain hunting in coming sessions although this will largely depend on how the US performs tonight.

US bonds are pointing to four rate rises this year which is more than expected and pressuring markets. There are some saying that the US Fed has made a mess of easing and have left it too late to contain inflation so will be chasing with faster tightening. If this is the case, I do not see traders wanting to add risk to portfolios or Funds willing to support price…so now is the time I am happy to be cautious hence the recent short on the ASX200 from 7325.

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ASX200 Index

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