Good Morning and Welcome to the XJO Monday Thread.
News for Today (AEST)
Lots of interesting analysis over the weekend, thanks to all who contributed.
I thought I would add a little to that this morning.
Just looking at the XJO first, you can see that the second wave had higher cumulative volume than the first, but it made less ground, showing the difficulty in moving higher right now (shortening of the thrust higher). However, the last complete bar does show a tiny spring of the last high, which may potentially give it a little bounce higher. It really does need to do more than a little bounce though, as that may only show a lack of further demand for higher prices, and offer a potential short set up. Have to wait and see what happens.........
The difficulty in moving higher can be seen clearly on a daily chart, the second wave having a much shallower angle, despite having more volume, showing the progress higher remained sluggish. The 100 (10 Bil) to the downside, may reflect a bearish change in behaviour, and a minor low volume up wave now would show a potential No Demand situation, as mentioned earlier.
A similar set up can be seen in the financials chart, the recent 47 to the downside was a potential bearish change in behaviour, followed by a low volume up wave (14), which showed a lack of Demand, then 38 to the downside and only 13 to the up was low demand again. It is currently bouncing off the previous highs & the last bar shows a little spring, so it is attempting to consolidate here, and might perhaps have another thrust up, but it sure looks weaker now, compared to a few months ago.
Meanwhile, over in Materials, things don't look quite as weak. Although there is some shortening of the thrust higher (high to high to high to high), the recent pullback only showed lowish volume, so selling pressure was not high, so far. A new higher high, and/or any further low volume pullbacks, would go a long way to proving the potential strength of the materials chart.
Energy, took off a little earlier than some other sectors, and has pulled back a little more recently. Note the spring of the previous low, possibly suggesting a bounce of some sort here.
The XGD (Gold Producers) had three strong legs higher before finding that demand was weakening, and is currently coming off on relatively low volumes. It attempted to find support off the previous high, but has since come back to the initial high.
and the DJIA also has a spring of the last low bar, it really needs to get going soon, as the lack of demand at the previous high (22) looked a little ominous. A break of that low would suggest a deeper pullback may be in order.
(20min delay)