for my heirs & descendents
Trump's Recession 2026
The Israel /US attack on Iran (February 28, 2026) precipitated a large fall in the US DOW Jones Index (DJI) and a corresponding fall in the Australian stock market Index (XAO).
From the beginning of January 2026 well before war was declared, the market's technical analysis indicators were signalling strongly that record high stock prices could not be maintained,
Colin Twiggs former investment banker with 40 years of experience in financial markets and co-founder of Incredible Charts says:
We Expect a US Recession in 2026
Several indicators are warning of a US economic slowdown in 2026, and we expect the economy to enter a recession in the second or third quarter.
Support Markets
-
Check support Markets (DJI / ASX)
-
Market Sectors' Indices
-
Aust Market Futures (AXVI)
-
Short Selling
-
Market Pivots and Cross Downs
-
High Frequency Trading
-
OECD Composite Leading Indicator
-
Manufacturing & Services Indicator
-
Prediction Markets
-
BCA Global Investment Competitiveness Index
-
IMD World Competitiveness Rankings
Check support Markets (DJI / ASX)
https://au.finance.yahoo.com/quote/%5EDJI/
https://www.marketindex.com.au/all-ordinaries
The first consideration in buying or selling is:
What are the support markets doing?
e.g. US Dow Jones (DJI) / Australian market (ASX)
Are they adding support or taking it away?
"A rising market lifts all boats" and vice versa.
The Australian stock market is often strongly correlated with the DJI Index
At the Beginning of 2026 (Feb / Mar) the US Market was Very Confusing
https://au.finance.yahoo.com/quote/%5EDJI/
The DJI continued to increase after a double top which is very unusual but is was followed by an even more emphatic triple top indicating strong resistance to further upward momentum: but the DOW went up anyway only to fall later at the end of February following the reporting season, fears regarding AI particularly with regard to IT and
Trump's attack on Iran without Congressional approval
The Australian All Ordinaries (ASX) fell sharply in lockstep with the DJI.
-
Check support Markets (DJI / ASX)
-
Market Sectors' Indices
-
Aust Market Futures (AXVI)
-
Short Selling
-
Market Pivots and Cross Downs
-
High Frequency Trading
-
OECD Composite Leading Indicator
-
Manufacturing & Services Indicator
-
Prediction Markets
-
BCA Global Investment Competitiveness Index
-
IMD World Competitiveness Rankings
Support Markets' recent Indicators are nominally turning positive (see charts above)
Market Sectors' Indices
https://www.marketindex.com.au/asx-sectors
The ASX is grouped into 16 Sectors' Indices. The ones with the higher growth rates clearly present the best investment prospects and the opposite is true for those with negative growth rates.
Early March 2026 was clearly not a good time to invest in the ASX.
-
Check support Markets (DJI / ASX)
-
Market Sectors' Indices
-
Aust Market Futures (AXVI)
-
Short Selling
-
Market Pivots and Cross Downs
-
High Frequency Trading
-
OECD Composite Leading Indicator
-
Manufacturing & Services Indicator
-
Prediction Markets
-
BCA Global Investment Competitiveness Index
-
IMD World Competitiveness Rankings
Australian Market Futures S&P/ASX 200 VIX (AXVI)
https://www.marketindex.com.au/asx/xvi
It is also worth checking market volatility before purchasing stocks.
The S&P/ASX 200 VIX (XVI) calculates the amount of volatility expected in the Australian stock market over the next 30 days. It uses the 30-day implied volatility of S&P/ASX 200 Put and Call Options.
-
High readings (20+) are bearish and indicate uncertainty
-
Normal readings (15 to 20) suggest a slight bullish bias
-
Low readings (<15) are bullish and indicate low volatility
-
Check support Markets (DJI / ASX)
-
Market Sectors' Indices
-
Aust Market Futures (AXVI)
-
Short Selling
-
Market Pivots and Cross Downs
-
High Frequency Trading
-
OECD Composite Leading Indicator
-
Manufacturing & Services Indicator
-
Prediction Markets
-
BCA Global Investment Competitiveness Index
-
IMD World Competitiveness Rankings
Short Selling
Short selling a stock is a strategy that involves borrowing shares from a broker in order to sell them. Traders do this to benefit from a decline in the share price. Once the price has reached the target level, the trader will repurchase the stock at a lower price on the market, closing out their short position. The borrowed shares are returned to the broker, and the trader keeps the price difference as profit.
As of February 18, 2026, the most heavily shorted stocks on the Australian Securities Exchange (ASX) were led by Boss Energy and Domino's Pizza Enterprises. Not a good idea to buy these shares?
17% Boss Energy Ltd Uranium production concerns and price volatility
16% Domino's Pizza Erosion of confidence in earnings recovery and turnaround execution
14% Treasury Wines Concerns over half-year results and soft global wine demand
13% Guzman Y Gomez High post-IPO valuation and wage cost pressures
12% Telix Pharma Delays in FDA approvals and valuation sustainability
Market Indices (XAO) Pivots and Cross Downs
https://en.wikipedia.org/wiki/2025_stock_market_crash
On "Liberation Day" (April 2, 2025) Trump signed Executive Order 14257, which officially introduced the 10% universal reciprocal tariff on nearly all trading partners. The smart money anticipated this and was getting out in mid Feb 2025 based on an XAO Index Pivot High (8825) and an Index and 5 day MA cross downs below the 15 day MA. The market fell -17% in two months. See the para above on short selling.
President Donald Trump’s embrace of tariffs to drive the US economy was rejected in a 6-3 ruling by the US Supreme Court on 21st Feb 2026.
High Frequency Trading
https://en.wikipedia.org/wiki/High-frequency_trading
The Australian sharemarket is witnessing a breakdown in “normal” trading behaviour and stocks are jumping around far more than usual. More than one in three Australian stocks traded up or down more than 5 per cent last week (Feb 15, 2026).
High-velocity trading, more commonly known as High-Frequency Trading (HFT), is a method of trading that uses powerful computer programs to transact a large number of orders in fractions of a second. It is a giant muck around, and you have to wonder how gaming the bots creates real long-term value. (AFR 16 Feb 26)
-
Check support Markets (DJI / ASX)
-
Market Sectors' Indices
-
Aust Market Futures (AXVI)
-
Short Selling
-
Market Pivots and Cross Downs
-
High Frequency Trading
-
OECD Composite Leading Indicator
-
Manufacturing & Services Indicator
-
Prediction Markets
-
BCA Global Investment Competitiveness Index
-
IMD World Competitiveness Rankings
OECD Composite Leading Indicator
https://tradingeconomics.com/australia/composite-leading-indicator
The OECD Australia Composite Leading Indicator (CLI) is a monthly index designed to provide early signals of turning points in the Australian business cycle. It predicts fluctuations in economic activity—specifically the output gap (the difference between actual GDP and its long-term potential). The indicator uses 100 as its long-term average. Values above 100 indicate the economy is operating above its long-term trend, while values below 100 suggest it is operating below trend
Manufacturing & Services Indicator
https://tradingeconomics.com/australia/composite-pmi
The S&P Global Australia Composite PMI, which is a weighted average of the Manufacturing Output Index and the Services Business Activity Index. The index tracks variables such as sales, new orders, employment, inventories and prices; and varies between 0 and 100, with a reading above 50 indicating an overall increase compared to the previous month, and below 50 an overall decrease.
Prediction Markets
https://kalshi.com/category/economics
Prediction markets are US exchange-traded platforms where participants buy and sell "shares" in the outcome of future events, such as elections, economic indicators, or corporate performance. These markets act as a "wisdom of crowds" mechanism
Between September 15 – when Polymarket launched a new category of betting contracts dedicated to forecasting the earnings of US publicly traded companies – to November 15, the research showed prediction markets correctly picked 68 per cent of earnings announcements a week out from the result, and 77 per cent the day before.
e.g. Kalshi is a primary CFTC-regulated exchange in the U.S. focusing on finance, economics, and political contracts.
BCA Global Investment Competitiveness Index
https://www.bca.com.au/bca-global-investment-competitiveness-index/
IMD World Competitiveness Rankings
https://www.imd.org/centers/wcc/world-competitiveness-center/rankings/world-competitiveness-ranking/