There's an old adage on the market.
Buy the rumour - sell the news. and the inverse.
Sell the rumour - buy the news.
And that's what happened today. There was a lot of fear and dread being written about in the media, forums and blogs about the upcoming Murray Report and its effect on banks. Well - it came out yesterday - and the big banks went up.
And the market which is heavily weighted to the Financial Sector - went up.
It wasn't all beer and skittles. The market fell away in the afternoon - and gave up a good part of the day's advance, But the XJO still finished up +0.7% and the Financial Sector finished up 0.88%. Volume was around abut the 20-Day Average.
There were some interesting special interest events, I won't include Qantas which is going gang-busters, but here are three.
First - CSL It had some weird gyrations on Friday which I thought might signal a top. But here's the chart:
Friday's bearish candle needed a big down day today to confirm. But - no way. It just kept going up, +2.86%. CSL has a habit of going up, consolidating sideways, then going up. At this time, it is still in the going up phase.
Next, NAB:
NAB benefitted today from the "buy the fact" scenario and went up +1.76%. But there is evidence of late day selling in the stock (see the upper wick on the candle). More importantly, the BBs are squeezing together - which suggests we'll see more sideways action for quite a few days. Anybody expecting a surge in the banks after today's positive reaction might be disappointed.
Next WOW:
I've been keen on Woolworths for a couple of weeks without seeing much for the interest. Wednesday's big up candle was a positive and the technical indicators are supportive of further upside. The past three days look like a bull market flag after Wednesday's big up day. But today's tombstone candle is enough to give punters the heebie jeebies. But one day candles are notoriously unreliable. We need to see a break above Friday's high to be sure of further upside. Until then, caution.
Redbacka
(20min delay)