greetings from malibu thursday, page-17

In Australia:

Twenty Leaders +0.3%
50 Leaders +0.4%
XJO +0.4%
XAO (All Ords) +0.3%
Small Ordinaries -0.2%
Financials +0.7%
Materials -0.1%
Consumer Staples +0.7%
Energy -0.6%
Health +0.7%
Telecoms +0.2%
Consumer Discretionary +0.7%

Comment: Reading today’s action is confused somewhat by Options Expiry Day. To add to the confusion, Options Expiry Day today involved the expiry of both Index Options and Individual Stock Options. That rarely occurs on the Ozzie Market. This month is the first month this year and last year there were no occurrences. (I didn’t check back further than 2011.) Volume was naturally high (20-Day Relative Volume was about 144%). OK. Small Ords is less affected by Op Ex Day than the blue chips. Today it was down -0.2% on high volume – but about in line with the previous two days. So we’ve got a negative day on high volume. It may be more or less significant. Something to keep in mind.

The day tended to follow the pattern of the previous couple of days where the market peaked in the early afternoon and then sold off. Again, how much was due to OpEx Day and how much the sell off was due to the Smarties pulling a bit more out of the market, as they’ve been doing recently, is difficult to determine. Just something to keep in mind.

Technical Comment on the ASX200:

The XJO finished at 4634.1. Oblique resistance lies at 4628.8. Today the XJO was marginally above that level. But only just.
Indicators:
Stochastic: 92.7. Overbought. Above its signal line.
RSI: 79.9. Overbought. Close enough to 80 – my Cloud Cuckoo level.
MACD Histogram. Below zero. Negative. But rising.
MACD: Above zero. Positive.
CCI: +134.9. Overbought. Negative divergence.

The last couple of days I’ve said: ” This remains a market where the major risks are to the downside.” Today only made it worse.

BHP broke its long run up today after eleven days up, but only just. Down -o.o5%. Today’s candle was a “rickshaw” man – indecision. It remains at a crazy level. That can be worked off by a sideways consolidation or a sharper pull back. We’ll have to see how it goes. But further extreme movement to the upside seems unlikely.

CBA Chart



CBA was up a little today, +0.29%. The chart isn’t dropping sharply from the rising wedge – so this is looking more like a sideways consolidation rather than a sharp pull back.

The market remains under the influence of the “Santa Rally” syndrome. It might just keep plugging up slowly. Any pull back is likely to be muted.



Redbacka