AZL Daily Report, page-18

Resource stocks very tentative and indecisive

Yes AZL remained flat to finish on 7.7c. Our volume today was on average of last few days, just over 12m shares traded. We got an announcement around DFS, lets see where it leads us to. Still holding 7.7 but barely - lets hope we get away from here soon.

ASX Li stocks remained indecisive as well. Of 54 stocks that I track, it was flat and there was no gain or loss.

Overnight US Li stocks were mostly positive. On average it gained over 2%.


What next -

Yesterday US indices too looked indecisive with going sideways and declining slightly. SP 500 dropped 0.4% to finish at 3949. ASX though was in good mood and gained over 0.5%. But most resource stocks that I track were still tentative and were mostly trading sideways.

SP 500 has now done 8 days between 3900 and 4000 and 6 times closing right in the middle around 3950. Lot of theories going around what is happening, one thought is around consolidation, other is that both bears and bulls are getting ready for next phase. So the next phase is clearly getting identified - which will blink first 3900 or 4000.

Not only stocks are indecisive, most analysts are also not in unison. Many are calling for a big drop soon. But others feel we may still go higher, even if we fall later further. So at this stage it is difficult to say what will happen next. Best is to wait to see what happens and then react. Lead Indicators were also mixed - Dollar Index, Yield and Volatility Index VIX - so no clear signal there.

So what will happen tonight? Unpredictable. The next big event is FOMC minutes on Wednesday after market opens. Most agree that for the immediate FOMC minutes will provide most direction, but that's Wednesday. Till then there is a chance we may go sideways - slight up or down. Lets hope the seasonality when late November we rally towards Thanksgiving happens and we cross 4070 on SP 500 representing 200 day moving average. Will that happen? Lets hope so. All the best.