ASX Morning call 9 OCT, page-6

SPI200 Commentary

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SPI got hammered Monday as it sold off from the open and kept going till close. SPI was sold off even more during Europe but recovered partly at the close. XJO closed at 6100 yesterday and that is a key level of support. There was support at 6100 in early September when the XJO had a fall from 6350 to 6100 in 7 days. SPI did fall further overnight but has recovered to where it was at cash close so that means XJO will be playing the 6100 games today. If we get more broad based selling like yesterday then that 6100 level quickly becomes resistance and XJO goes to 6000. If there is a bit of a bounce then 6100 becomes support and it should get to 6150 before falling again. Another key to watch today is how China and Hong Kong trades. China cut reserve ratios which should stimulate their economy but its markets got sold off instead. For todays trading I am looking to buy dips around 6040 and sell rallies around 6080