Long Vegetables - Tuesday

Good Morning and Welcome to the XJO Tuesday Thread


News for Today (AEDST)




The XJO closed as an up bar on Monday, after being much higher during the day.



The Story of the Day
Using the Intraday (~10min, 3point wave or reversal) chart, the free and easy acceleration higher from 5335 early in the day can easily be seen.
Then there was a short and shallow pullback adjacent to last Fridays day high,
where after some absorption and finding supply to be low, the Index again pushed higher & briefly exceeded Fridays high.
Some supply then arrived and knocked price back, where it retested the line drawn across Fridays high (5389.4) from above.

Up to this point all looked quite nice,
& the expectation was for the Index to again accelerate away from the danger point, or at least maintain the level adjacent to last Fridays high.

However, the next up wave (31) made very little ground higher (compare to the upwave on 36), which suggested supply was thwarting progress.
The question was whether this supply would be absorbed (bought) by the market at this point,
or the would supply overwhelm price, forming a bearish Effort Vs Reward failure.
The absorption theory was looking OK on the first relatively shallow downwave (15), but the next upwave found demand on the wane (12).
And supply continued to come in, forcing price back down & below the line drawn across last Fridays high (breakdown).

Then the next upwave (14) again found demand lacking and confirmed the breakdown by failing to regain the 5389 level again.

The day then closed back level in the relative comfort of the early session congestion, just below last Fridays high.

If price attempts to push higher on Tuesday, 5389 (last Fridays high) and the congestion now surrounding it,
will likely provide some ongoing resistance above.
And should price continue lower, the zone between 5335 and 5350 may offer some potential support,
and after that the congestion between 5310-5325.









Good Trading and Investing

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