Yesterday in Australia:
Australia was up strongly yesterday +1.31% after news of a possible treatment for COVID-19 was announced before our market opened and after the U.S. had closed.
That kept the current short-term up-trend alive, but it does appear to be on its last legs. The upsloping wedge is bearish. MACD Histogram is close to turning negative, and the CCI is showing a negative divergence.
Yesterday's rally was led by the Industrials Sector (XNJ) where transport related stocks are located. Sydney Airport (SYD) +8.28%, QANTAS (QAN) +7.2%, Atlas Arteria (ALX) +7.02%, Transurban (TCL) +6.72%, Auckland International Airport (AIA) +4.98%. Seek (SEK), also in this sector, was up +5.19%.
Financials (XXJ), the largest sector in our market, was up an anaemic +0.21%. Three of the four big banks actually went down (CBA, WBC, ANZ). That's hardly a vote of confidence in the underlying strength of our market.
Overnight:
The news about a possible treatment for COVID-19 thrust the American market higher.
Dow Jones +2.99%. SP500 +2.68%. Nasdaq +1.38%. Small Caps +4.51%.
SP500:
SP500 now faces its most important resistance area so far in this rally, dual resistance of the 50-Day MA and the low from 28 February. I'd expect that dual resistance to at least result in a pause in proceedings. Notice that the MACD Histogram has gone negative.
Commodities:
Commodities were generally positive. Commodities Index +0.44%. Base Metals +1.12%. Energy +0.72%. But Gold continued its pull-back from recent highs -1.94%.
CNN Fear and Greed Index
CNN's Fear and Greed Index continues to hover just inside the Fear Quadrant.
If we're to see a pull-back as we saw in 2018 and 2019, now is about the time for it to happen:
Markets are now at an inflection point. The next week should prove whether the bulls or bears prevail.
(20min delay)