boxing day hangover, page-17

In Australia:

Twenty Leaders +0.1%
50 Leaders +0.2%
XJO +0.3%
XAO (All Ords) +0.3%
Small Ordinaries +0.9%
Financials -0.0%
Materials +0.6%
Consumer Staples +0.1%
Energy +0.6%
Health -0.2%
Telecoms +0.2%
Consumer Discretionary +0.7%

Comment: There’s not a lot of reason in our market currently. It continues to eke out gains and become more and more overbought. It has dislocated from America. We seem more influenced by Japan and China. That seems logical. But America is still the dominant player in the financial sphere. hmmmm. Something's wrong.

Technical Comment on the ASX200:
The XJO finished at 4648. Oblique resistance lies at 4649.3. Today the XJO was marginally below that level.
Indicators:
Stochastic: 85.4. Overbought. Below its signal line. Its now been overbought for the whole of December.
RSI: 78.4. Overbought. Close enough to 80 – my Cloud Cuckoo level.
MACD Histogram. Below zero. Negative.
MACD: Above zero. Positive.
CCI: +122.4. Overbought.

The chart is now as tight as it can get. The wide range day last Friday still remains the benchmark. If the market can breach the top of last Friday we’re probably going to see one helluva blow-off top. Cant’ wait for the fireworks. :)

Once again the old Keynsian quote comes to mind: The market can remain irrational for longer than you can remain solvent. Shorters who got in early when the market first became overbought are now feeling sick, that ‘s if they are still solvent.

The risks remain to the downside. But I wouldn't be shorting this just yet. Maybe soon.

Redbacka