ASX Weekly Wrap. Week ended 29/11/24.Weekly Chart.XJO up this...

ASX Weekly Wrap. Week ended 29/11/24.

Weekly Chart.

XJO up this week +0.51%.

The XJO is in a strong up-trend. The 20-Week MA has been steadily rising since the beginning of 2024.

The Index remains in the top half of the standard Bollinger Bands (10/2). While it remains in that zone, the market remains bullish. Stay with the long-term trend. Look to buy any pull-backs.

Daily Chart.

The daily chart shows a short-term bearish rising wedge which usually breaks to the down-side.

Look to buy the dip if the chart reaches the 20-Day MA - middle line of the Bollinger Bands.

Sector results for this week:

The notable event this week in the Sector Graph was the fall in Financials (XXJ), down -0.8%. That's important as the Financials Sector is by far the largest Sector in the ASX. It has also been one of the leading sectors throughout this long bull run.

If we look at the Mansfield Relative Strength Chart for ASX sectors, we see that XXJ was the second best performer behind only the relatively small and very volatile Technology Sector (XIJ). If XXJ continues to fall, then the whole market may be in danger of, at least, stagnating.

Notably, XXJ's loss seems to have been a case of rotation into some previously weak Sectors - Materials, Health and Staples.

Energy continues to be the major failing Sector, down again this week, -3.14%.

U.S. Dollar

The U.S. Dollar has a big effect on Australian resource stocks. Commodities tend to be priced in U.S. Dollars. If the US$ falls, Australian resource stocks benefit. And vice versa. If the US$ rises, Ozzie resources tend to fall. That fall in the US$ seems to have helped Miners this week but not the Energy stocks.

Energy stocks tend to be more influenced by geo-political events.

U.S.$ has been in a strong up-trend since early October when DMI+ crossed above DMI-. The trend strength indicator (black line) is very strong up around the 50 level.

This week, US$ fell back to the 20-Day MA where it found support back in early November.

If the US$ bounces here off the 20-Day MA as support, we might again see a pull-back in the miners.

New Highs and New Lows.

I use this as a guide to long-term investments. While New Highs exceed New Lows, the out-look for long-term investments is positive.

We can see that there was a small dip August, 2024, but the chart quickly recovered and has been positive for long-term investments since the beginning of this year.

That's in keeping with the 20-week MA shown on the Weekly XJO Chart at the top of this blog.

Conclusion

The Australian market is in a long-term up-trend. New Highs and New Lows indicate a favourable environment for long term investments.

Miners benefitted this week from a fall in the US$. If the U.S.$ bounces off the 20-Day MA, we may again see falls in the miners.

Notably this week, Financials (XXJ) fell in a positive market. If weakness continues in XXJ we may be looking at a stagnate market. If XXJ and Miners both fall, we could be looking at a falling ASX. Just setting out a couple of scenarios to watch.

Full 20 Leaders Weekly Wrap later this weekend.

Take care