CBA TA Update
Here we go again.
It's been a little while since last posting and looks like things all ran to plan from last post
HERECBA dropped quick to lower support - tick
CBA got the bounce off $93 - tick
CBA filled the Volume Void above (shown in last post) - tick
CBA has now tested and had an initial rejection off the 2yr VPOC (today) - tick
Todays close didn't surprise much with it bang on the lower edge of the largest HVN in picture.
This initial rejection does give the advantage slightly (and I'll emphasise slightly) to the bears.
The sp did have a crack at a clean break from the $99.50 zone today but unfortunately ran into the psychological price of $100 - which turned out to be bang on todays peak.
CBA Daily
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If the $99.50 - $100 zone holds then I'm expecting a test back onto $95.50 - $96 area before any further big decisions are made - the gappy run up to $100 from this base does make this the path of least resistance.
If there are any ST pulse moves there are significant volume voids both above and below the current sp
Watch for reactions at $101.20 (above) and $97 (below) - I've outlined these areas on the 15min chart below
CBA 15min
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Is todays move a clear set up?
Not at all.
Feb and March were very good months for those with put options and April is a little trickier.
April is typically a great month for financials as you can see from the chart below and CBA has had a strong reversal in recent sessions, so if history is anything to go by then long holders should enjoy the next few weeks.
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When I came on here last time discussing the bank sector I was ridiculed and told that the SVB incident was isolated and I didn't know what I was talking about. The same posters were the ones reacting off the latest headlines, whereas I'd be loading short positions since the start of the year - maybe just dumb luck, who knows...
I mentioned the thing that caught my eye late last year were all of the withdrawals from the Discount Borrowing Window - basically banks emergency funds.
It's clear the activity toward the back end of last year was a lot more than just SVB and that we'd be hearing more about this (BEFORE the recent huge spike).
Then what'ya know, the window got jolted WIDE open for whats now been labelled the global 'Banking Crisis' - not so isolated I guess...
So do I think we'll be hearing more about this?
Yes I do.
The days of easy credit are done and many financial institutions need to batten down the hatches for whats ahead as many small banks will come under a ton of pressure soon and that will place pressure on the entire system.
Seems even China is joining the party with a crackdown on the bank sector to snuff out the rorts that have been going for way too long.
Anyway, there I go again dribbling on to stuff that's way above my pay grade, so back to TA...
I'm expecting a ST pullback and have taken the first small position on CBA with a hope to see that $95 - $96 zone tested.
Any over shoots and will be watching $101.20 but the real wall comes at $104.
I'm not touching April contracts as I don't believe any move from here will be straight forward and thus am prepared to pay a time premium.
Short is certainly against seasonality but I've got to stick to my thesis and take any consequences from that.
Really can't complain as I'm currently just waiting to take off to Thailand for a couple of weeks thanks to CBA, BEN and XJO puts for Feb/Mar so lets see how this next chapter plays out.
Anyway play safe, stay nimble and good luck whichever way you trade...
(20min delay)
