Motivation - Wednesday, page-3

Here's the XJO chart for today:



XJO continues to test the recent line of defence.  That's 4909.6.  Today's low was 4910.7.  Today's low was higher than the previous day's low at 4880.1.  That now becomes the most important pivot point to watch.
Yesterday recovered after breaking below 4909.6.  So the new pivot point takes on added importance.

The Index is oversold.  

Today's performance on the XJO was a little disappointing for those who expected a big rise after the previous positive reversal in America.  But - the Ozzie market still seems to have reservations.  That's not unusual.  The last bears may just be fighting their final reguard action.

Momentum has slowed right down.  That's often necessary for a rebound to the upside.  But we need to see a big up day to confirm a bullish bias.  Today's "tombstone" candle is not necessarily bearish.  It would be at the top of an up trend, but at the lower end of a down trend it is often bullish.

Today's action was not just a bull/bear battle.

Here's the sector performance:



Energy (-3.5%) and Materials (-2.3%) were massive drags on the market.  Meanwhile Financials (0.4%), Health (-0.9%), Industrials (+0.3%) and Telecomms (1.1%) performed creditably.

It's the old story.  It's not a Play about Bulls versus Bears.  It's a Play about Resources versus Financials, with others playing bit parts.

Here's a chart for XXJ (Financials X-Property):



The chart is in a gently sloping up trend.  The three-channel Standard Error Channel suggests that XXJ is at a turning point before returning to the upper edge of the SEC.

A big up day would confirm the legitimacy of the lower edge of the SEC.

RB