XTL 14/15 Dec. Charts, page-3

XJO Weekly Chart.

XJO down heavily this week, -1.48%. That's taken the chart into the imbalance zone left by the big surge beginning the week of 18 November. That probably means that this pull=back is over.

It remains in an long term up-trend.

XJO Daily Chart.

XJO has been falling through support after support.

On Friday, it fell to the next level of support at 8272 and rebounded, recovering about half the day's intra-day losses. That's promising.

We need to see carry-through buying on Monday to confirm that this pull-back is over.

Friday night ASX Futures are not encouraging, as they were down -0.49%.

Sector results for this week:

Nine out of eleven sectors were down this week, and the only two sectors in positive territory only just managed to scrape into positive territory.

Best were Staples +0.08% and Materials up just +0.01%.

XGD (Gold Mining) is not a sector, but an industry group within Materials. XGD was up +0.5% but fell heavily on Friday -2.23%. It's current bullish rally may have petered out.

Worst by far this week was Technology -5.73%. It is a notoriously volatile sector. During the past 200 days, it has been the best performing sector, up +20.98%, just ahead of Financials +19.78%. XIJ makes for good trading opportunities, but for buy-and-hold investors it provides plenty of sleepless nights.

The following sectors all did worse than the xjo:

• XIJ -5.73%
• XPJ -2.03%
• XXJ -2%
• XNJ -1.98%
• XTJ -1.78%
• XHJ -1.76%
• XUJ -1.52%

That's a dreary list of sectors, especially for longer term investors, many of whom may have been expecting an early Santa present.

The second week in December has a poor record - there's plenty of time left for Santa to come.

New Highs and New Lows.

I use this as a guide to long-term investments. While New Highs exceed New Lows, the out-look for long-term investments is positive.

We can see that there was a small dip August, 2024, but the chart quickly recovered and has been positive for long-term investments since the beginning of this year.

This is a guide for long-term investors. It's saying: "Stay Long".

Australian Vix - XVI

XVI normally trades inversely to the XJO. If XJO is down, XVI is usually up. If XJO is up, XVI is usually down.

What happened this week? The opposite of what should happen. XJO was down, XVI should have been up - but, no, it was down. Something's not right here. Either XJO is wrong, or XVI is wrong.?

No only that, but XVI fell below the magical number 10. XVI finished at 9.9. Low volatility is expected in the next month.
So a Santa visit is looking hopeful.

Conclusion

• The Australian market has been very weak for the past eight trading days.
• It is now down to a level where a bounce can be expected.
• VIX and XJO are giving conflicting signals, one if not "right".
• Look for a bounce in the next couple of trading days.
• Friday night's ASX Futures were bearish. So it would take a leap of faith to enter the market on Monday.
• NewHighs/New Lows remains bullish.

Take care
RB