Every week on Zaks-TA.com, as well as producing daily charts and analysis for a range of indices and individual stocks, Zak Mir provides a detailed editorial looking at the overall economic outlook and interesting stocks of the moment from a technical perspective. In this excerpt from his latest editorial, Zak considers the possible upcoming "Bloodbath" in the markets.

To get Zak's full editorial every week, plus daily charts and analysis for the major markets and a variety of individual stocks, join Zaks-TA.com now by clicking here.

Following July's "Death Cross," and August's "Hindenburg Omen," it looks as though September is going to give us "Bloodbath." This is from an analyst at SocGen, a financial institution which previously brought us one of the largest "rogue trader" events in history and is thus familiar with the concept.

Once again, I would state that even though the current state of the charts on indices is on the bearish side - below the 200 day moving averages and demonstrating multiple resistance points since May above 5,400, the lack of any serious decline so far suggests at least from a psychological point of view that we are being scared / suckered out of a the start of a rally rather than correctly being warned of a sell off.

Looking at the detail on the FTSE 100 after Friday's rebound it can be seen how we seem to have a choice in terms of support lines in the recent past. Either you can go by the blue line from 2008 running through 5,100 - suggesting we have hit the bottom - or you could also be bullish off the black May support line at 5,100; but a follower of the broken red May line at 5,200 would already be shorting aggressively and only reverse well above the recent 5,400 zone resistance.

Which is the correct line? In fact, it could very well be the blue line from 2008 - which when coupled with the line of support in the RSI window, hit mid week, backs the idea that we have had our bear trap and could hit 5,400. However, this is only a view on the next week or so and therefore caution is still the watchword.

To read the full version of Zak's editorial, plus see all today's updates, including a Major Markets review, Zak's Chartbreakers and a daily portfolio update, click here.

Best Wishes,

Zak Mir

Zak Mir is perhaps the UK's best known chartist and Zak's real time trading signals are ideal for the current volatile markets! To access Zak's service with real-time trading signals and around 30 big calls per week on indices, blue chip stocks, commodities, small caps and member requests a week for as little as 179 pounds a year click HERE.