ASX 200 Forecast: Bearish Renko Setup Eyes 8,255

Author: Cedric Thompson

Published: May 21, 2026

Key Points

• The ASX 200 Index is experiencing broad selling pressure, primarily driven by declines in gold miners and major banks.
• Market breadth is at a critical level, with only 29% of ASX 200 stocks trading above their 20-day moving average (MA).
• The medium-term outlook remains bearish, as the Index is below both its 50-day and 500-day simple moving averages (SMA).

Market Overview

The ASX 200 Index has seen another day of declines, with significant losses from major players in the gold mining sector. Newmont and Evolution Mining have dropped 4.46% and 4.85%, respectively, contributing to the overall downward trend. Other heavyweights like BHP, Rio Tinto, Westpac, and ANZ have also added to the selling pressure.

Market Breadth and Indicators

Current market breadth indicates a potential capitulation phase, as only 29% of stocks are above their 20-day MA. A recovery above 30% could signal a bullish reversal. However, the ASX 200 remains below its key moving averages, indicating continued bearish sentiment.

Yield Analysis

The Australian 10-year yield is currently above both its medium and long-term moving averages, showing positive momentum. The Relative Strength Index (RSI) is above 50, suggesting bullish conditions, but the short-term trend remains negative. A retest of the 5.175% highs is anticipated, which could further pressure equities.

Technical Analysis

The Renko chart for the ASX 200 indicates a persistent downtrend, with the Index making lower highs and lower lows. The Supertrend indicator has turned negative, and the RSI is nearing oversold territory. The Z-Score SMA is trending lower, reinforcing the bearish outlook.

Conclusion

The current trend for the ASX 200 is bearish, with a focus on the support level at 8,255. While the market breadth suggests a potential end to the pullback, confirmation is needed through a recovery above the 50-SMA and 500-SMA. Until such confirmation occurs, the outlook remains negative.

Support and Resistance Levels

Support Level: 8,255

Resistance Levels: 8,880, 9,230

Author's Background

Cedric Thompson is a certified investment strategist with expertise in asset management, corporate strategy, and multi-asset investing.