International Women's Day - Tuesday, page-2

Monday Evening Liqueurs. 7 March, 2016.

XJO up strongly again today, +1.04%. Volume remained today in the recent high volume range.

Here's the daily Heiken-Ashi XJO Chart:



The chart is now at resistance around 5150. The short term stochastic is at 97.3, which is puts it in the 'caution' zone.

No negative divergence exists on the short term Stochastic, so any pull-back will probably be bought. Let me emphasise that. We're in the 'caution' zone - but any pull-back is likely to be bought.

Risk-On and Risk-Off ratios continue to favour a risk-on attitude.

Here's the ratio chart for IAF/STW (bonds/stocks):



Stocks are clearly preferred over bonds after recent volatility in the ratios. Such volatility usually precedes a change in the attitude of investors.

A couple of weeks ago, I indicated that we were probably entering a period of Risk-On. That is clearly the case now.

Cyclicals should be preferred over defensives. There are always exceptions. This comment shouldn't be taken as a suggestion that defensives are duds. Far from it. It just means that other stocks in other sectors will probably perform much better.

A few weeks ago, near the beginning of the year, Punters and Gurus were invariably bearish. The end of the world (for some) was nigh. For others, we were in a bear market like 2008.

That's not the case.

We are currently in a strong bull market rally. That may not continue. Watch the charts, not the gurus and the doom merchants.
RB.