Weekend Charting and Chat XJO

Overnight:

We've seen two major market moving events this week. Wednesday saw the Fed announcement - the market fell. Friday saw the Jobs Report - the market went up. Take-away from that? Don't pay too much attention to major news events - they may only last for a couple of days. They're just knee-jerk reactions. Watch the trends

Dow Jones +0.75%. SP500 +0.96%. Nasdaq +1.58%. Russell 2000 +1.98%.

SP500:

I noted yesterday that the SP500 was back down to the 20-Day MA - watch for a pop=up. Well - we got that today. SP500 is back above its 5-Day EMA and above horizontal support/resistance. DZRSI has popped back above its lower band. Look for more upside.

The poor performance of the Money Flow Index remains the biggest concern.

Commodities:

Commodities Index flat +0.06%. Base Metals +0.43% but remains oversold. Energy +0.2% and appears to be headed for the oversold region. Gold +0.59%. The positive divergence on the Slow Stochastic suggests a counter-trend rally could be possible. Gold is currently in a medium-term down-trend. I'm still mildly optimistic about the chances for Base Metals and Gold, but need to see more evidence.

Fear and Greed:

CNN's Fear/n/Greed Index stands at 60, down from the previous week's reading of 72. Meanwhile, the SP500 is up +0.2% for the week. That suggests we'll see more upside in the American market. When the Index gets into the Extreme Greed quadrant, I might get a bit worried.

In Australia Yesterday:

XJO flat yesterday -0.04%. The XJO remains in a tight consolidation pattern. Watch for a break one-way or the other.

The True Strength Index shows a big negative divergence. Divergences are unreliable - but do provide warning signals. We trade price pattern not divergences. But, if the XJO does break lower, then we should be concerned. Given events overnight in the U.S., it seems unlikely that we will break lower on Monday.