According to O’Hare, the market has breached the downside of a five-year bullish channel, which compounds his negative medium term bias. Looking to the daily chart, it has formed a bearish flag with a bias to break to the downside and Friday’s close below the flag baseline has confirmed the break, O’Hare says.

He is looking to set shorts on the open close to 6100 and add to shorts on a break of 5985, which O’Hare says should lead to an acceleration in losses. His targets for this trade are the 161.8% fib extension level at 5814, but ultimately a measured target of 5350 – a price not seen since mid-2012. The stop on this trade is a break back above 6200 .