helium's - fear of the unknown - tuesday, page-30

The good news – there isn’t any. Here’s the bad news:

In America:

Dow Industrials -2.36%
Dow Transports -3.6%
SP500 -2.85%
Russell 2000 -5.38%
Nasdaq100 -2.53%

Comment: Another solid down day with breadth (Russell2000) horrible. Volume is increasing steadily. Was last night enough to represent a wash-out? Probably not. But the increase in the New Lows suggests we’re close to a bottom. NewHighs/NewLows 15/837. That’s the highest figure for New Lows since the August lows. So the market is close to a bottom.

The Materials Sector -2.81% and Energy Sector -3.4%. Those figures are poor and negative for the Australian market on Tuesday. All nine S&P Sectors were down. The Financials Sector was the worst, -4.49. The Banking Index was hit hard, -4.78%. Semi-conductors down, -3.67%. The market was uniformly weak.

Interestingly, Copper was down just -0.05%. Relatively flat. In my last two weekend reports, I’ve mentioned that Copper, the bell wether for the economy and mining stocks, should be watched carefully. Last night Copper had a strong reversal day upwards (despite the flat finish). That’s the third in the past six days – on very high volumes. (I’ve marked those days with arrows.) That looks to me like the smart money is starting to buy into the Copper story. If so – asset prices in general are very close to a bottom.

Europe:
France -1.85%
Germany -2.28%
London -1.03%

Gold in U.S. Dollars is up +2.12%. Gold in Oz Dollars is up +3.74%. AUD/USD down, -0.79% to finish at 96.28. The Ozzie is below minor resistance of 97. The 95 zone targetted – and further falls in the Ozzie stock market. EWA (the ETF for Australian shares) down -3.29%.

Technical Comment on the Dow Industrials:
The DJIA finished at 10655.3. Now close to the August lows.
Below the 8-Day MA. Negative.
Below the 34-Day MA. Negative.
Indicators:
Stochastic: 35.6. Below its signal line. Negative
The 8-Day MA is below the 34-Day MA. Negative
The 13-Day MA is below the 150-Day MA. Long-term negative.
RSI.9 is at 35.7. Oversold
MACD Histogram marginally below Zero. Neutral.
MACD (zero lag) marginally below zero. Neutral.
CCI.9: -141.5. Oversold.

Momentum indicators allow for more downside. Until the Stochastic gets below 20, I doubt we’ll see a rebound. The New Lows figure suggests we’re close to a washout. And the Copper chart also suggests a turn around is near.

But – the trends are down.

Don’t pre-empt the market.

Good luck
Redbacka