Friday 10 April ASXSPI200, page-10

Yesterday in Australia:

XJO was up strongly +3.46%. The short-term trend is up. The medium and long-term trends remain down.

Slow Stochastic and Commodity Channel Index are both now overbought, but need to turn down to indicate some threat to this trend.

MACD(3/10/16) shows a negative divergence which suggests that momentum is easing off - that needs to happen before we see a down turn.

Overnight:


The American market continued to rally. Dow Jones +1.22%. SP500 +1.45%. Nasdaq +0.77%. Small Caps +5.11%.

SP500:

The technical picture for the SP500 is similar to Australia. It is overbought on both the CCI and Slow Stochastic. MACD (3/10/16) indicates that momentum has slowed. It wouldn't take a lot to turn this down.

Short-term trend is up. Medium and long-term trends remain down.

How high will this rally go?

The daily chart is now at the 50-Day EMA - that's a possible resistance level.

To get further clues - we need to look at a longer term chart:

Above is a monthly chart of the SP500. SP500 is now at a horizontal resistance level set back in 2017. So the current level is a possible resistance level. I'll be looking for signs that the market will turn down at this level.

2018 and 2019 provide the next higher resistance level. I doubt the SP500 can go much higher than that.

Commodities:

Commodities Index +0.26%. Base Metals +0.57%. Energy -1.22%. Gold +2.61%

The Australian market doesn't open again until Tuesday. America will be open on Monday. So we need to wait and see how America does on Monday.