FX.co ★ Elliott wave analysis of the Swedish OMXS30 Index for January 20, 2023

Today we will look at the Swedish OMXC30 index, this is the major equity index in Sweden counting the 30 largest companies in Sweden. As we can see, we have one of the nicest-looking ending diagonals I have seen in a long time. As the name of the formation says, it completes a five-wave impulsive rally. It's the only impulsive formation, where we allow an overlap between waves 1 and 5. Once the ending diagonal completes, which often happens with an overthrow of the ending diagonal resistance line, which also has been the case here, we should expect a return to the origin of the formation, which in this case is at 446 in about half the time it took to build the formation. As it took 20 years to build the ending diagonal, we should expect it to return to 446 in half the time or 10 years.

This does not border well for the Swedish economy in the years ahead.

The first strong indication that the OMXC30 is ready for the next steep decline is upon a break below support seen at 2,023 which calls for a test of important support at 1,701 and then 1,456 as the next support levels to look for.