From the previous XAO post - clarity would soon be shed on the XAO medium term direction and it's not good news.
In fact, this leg down could be very aggressive - Over two years ago this October 2008 post (on ASF) for the long term view provided some rough guidance on how the XAO would play out over the coming years: wave 'A' circle to complete, a corrective wave 'B' Circle to unfold, and once completed 'GFC II' aka wave 'C' circle would be unleashed.....However, wave 'B' Circle took a lot longer to unfold as a more complex correction.
October 2008 View - zig-zag correction on the XAO
XAO Short Term View
The short term view is for 5 waves down to unfold before the first major bounce occurs. The MACD is at an extreme, implying the end of wave '3' down is complete. It is assumed a triangle will unfold for wave '4' that will see sideways action for 2-3 weeks before another push lower to complete this first of a series of 5 wave declines.
The social mood will continue to decline dragging the stockmarket with it - riots in Europe are a precursor to bigger things to come.