Helen Back - Wednesday, page-4

Big down day. So what's new? Tuesday Evening Liqueurs. 15 September, 2015.



XJO down -1.53%. Yep that's a bad number - but since early August those sorts of numbers are common not rare.

Here's the chart:



The Index is in a trading range and coming down to test the horizontal support level at around 4980. If that breaks we'll probably see much lower figures on the XJO.

In April, the XJO was knocking on the 6000 door. Now it's knocking (on the down side) of the 5000 door. That's a drop of about 1000 points (in very round figures).

The America market confronts the FOMC announcement on Thursday night (our time). That reaction will probably have a determining effect for the medium term.

Here's the Relative Strength readings for the S&P Sectors and Industries that I follow on the Australian market.



Utilities and Industrials remain the two strongest sectors.

Here's the chart for XUJ (Utilities):



Although relatively strong when compared to the XJO - Utilities is in a sideways trend. It is now at the lower end of that trading range, and, although down today in absolute terms, it improved its relative position against the XJO. It looks set up to return to the top of its trading range. Look for the Stochastic to turn up above 20.

Energy remains the weakest of the Sectors. Here's the chart:



Although down today (-1.01%), Energy improved its relative position vis a vis the XJO just a little today.
Some indicators are showing positive divergences, so a short term counter trend rally is on the cards. Just don't expect too much from it. Energy is in a secular bear market, and until there is evidence of a change in that status, this Sector is one for the nimble, experienced traders. Yesterday's candle, which showed distinct intra-day buying, held out promise of a move to the upside, but it needed a strong day today to confirm. It didn't get it.

Bear markets are a test of patience. In the end, patience will be rewarded.

RB.