I don’t do reports on Friday evening – that’s my night out. On Sundays I do a major Weekly Report covering a smorgasbord of topics all with the purpose of getting some idea of the state of the Australian market, the forces impinging on it, and possible direction.
Saturday mornings I provide a simplified report updating on the American and Australian sessions on Friday.
Here are five major American Indices (SP500, Dow Industrials, Nasdaq100, Russell2000, Dow Transports):
The indices were generally well up early in the session, but came under selling pressure from around 11.00 NY time. Then the Sell-The-Rallies Mob dominated. Any attempt by the bulls to push the market back up was met with greater downward pressure by the bears. This is most evident in the NDX and R2k. Both have long upper tails and finished close to the opening for the day. NDX up +0.23%, R2K marginally up +0.03%. Both of these indices are in down trends and under their 50-Day MAs. Both are oversold so some sort of a bounce might come next week. SPX and Dow 30 both continue in sideways consolidations and sit above the pivot points of 14 March. The other three indices (NDX, R2K and Trannies) have all broken below the 14 March pivot. This divergence, particularly the relatively poor breadth in the R2K, suggest the two big benchmarks (SPX and Dow30) are more likely to break lower than rise.
Here’s a more detailed view of SPX:
At this stage, SPX continues to hold above the horizontal support formed by the tops set back in December/January. It also bounced off the 40-Day MA last night. This chart clearly shows the importance of the 14 March pivot.
The March quarter has only one day to run.
Yesterday in Australia:
Reversals are often prefigured by positive divergences on the CCI. We can see how those played out in December and Jan/Feb. Recently, we had a similar positive divergence but, so far, the ensuing up trend has been relatively weak. The December Santa Rally had a little stutter before launching higher, so there’s some hope for the XJO bulls, but, at this stage, it’s reversal is not looking strong.
Friday ended as an inside day, suggesting indecision. The chart remains below the 40-Day MA. That’s another sign that this market is lacking the strength to burst higher.
(20min delay)