biggdaddy's wow wednesday, page-133

XJO (ASX200) -1.1%
XTL (Twenty Leaders) -1.1%
XFL (Fifty Leaders) -1.1%
XFJ (Financials) -1.5%
XMJ (Materials) -0.8%
Energy -1%
XSO (Small Ordinaries) -0.5%

Comment: Another big day down, but it was better than it looked. You can see the longish tail on today’s candle – the market was much lower at around noon. It then staged a rally but started to sell off again around 3.30 and continued on down into the after-market auction. Nothing dramatic but enough to take the gloss off the afternoon rally.

If we ignore Friday’s big volume (bloated by Options Settlement), today’s volume was the highest of the previous 12 days. Nothing dramatic – about 108% of the 10-Day Average. If this was a reversal day low – I’d expect a bigger volume than that.

Breadth, however, was good – you can see that in the Small Ordinaries figure – which was the least of the major indices reported above. So there was more than a bit of nibbling going on during the day.

INDICATORS:
RSI.9: 46.1. Below 50 – Negative. I think we need to get down closer to 40 before we see a rebound in the market.
MACD (zero-lag) Histogram. Below Zero. Negative
MACD (zero-lag). Above Zero. Positive.
Stochastic: 37.3. Below its signal line and heading down. Negative.
CCI.14: -75.4. Heading down. Still not oversold. Negative.

The XJO closed at 4184.6. The index hit 4141.3 today before rebounding over 40 points to end down about 48 points. A good effort, but maybe not quite good enough.

The lower short-term Bollinger Band is at 4136.9 – so we had a double whammy support around 4140 today. No wonder the market bounced.

If you look at the bottom Bollinger Band you’ll see how it’s flattened out – and today’s candle moved away from the bottom Bollinger Band. That’s a positive sign.

If that level (around 4140) holds, then this could be the end of the pull-back.


A big up day tomorrow would seal the deal. If we’re in a bull market, then, that is a real possibility.

Let’s see how tomorrow goes.

Redbacka