Many months ago we signaled that that Australia was a market to closely follow as it had all the lookings of a bull market in 2020: An Australian Stock Market Outlook For 2020 And 2021. Moreover we gave it a top spot in our The 4 Top Emerging Markets of 2020. This week we see the confirmation of our bullish forecast. To be more precise Australia’s stock market is one of the most beautiful breakout plays of 2020 (so far).
We looked at the monthly chart to come to our conclusion.
Look at this beautiful setup: a giant reversal over almost 2 decades in the form of a bullish triangle formation.
We see this Australian stock index now breaking through its 2008 highs, also all-time highs.
There is one very important point we want make with Australia’s chart outlined below. This is a horizontal breakout play. We know that horizontal breakouts are the most explosive momentum plays. They are powerful simply because there is no overhead resistance.
We tend to call them clear-sky-breakouts suggesting there is almost unlimited upside potential.
It is clear that there is a lot of momentum in Australia’s stock market.
That’s why we are sniffing the Australian stock market for a momentum play.
