Great Cranker. Fantastic classic movie. References, of course, the poem by William Butler Yeats: Sailing to Byzantium. "That is no country for old men." and, one of my favourite sets of lines:
"An aged man is but a paltry thing, A tattered coat upon a stick, unless Soul clap its hands and sing, and louder sing... "
Comment: The Dow 30 pulled away a little from major resistance. A narrow range day, on higher volume, close to major resistance. The bull/bear battle rages. At this stage in the trend the bears are more likely to be the ‘smart money’. They usually win.
All other indices were weaker.
NewHighs/NewLows 92/14. NH>NL. The ratio of NH/(NH+NL) is at 86.8%. The Ratio remains in the “Do Not Sell” Zone above 80.
Technical Comment on the Dow 30:
The Dow finished at 13213.6. S/R: 13000/13260 (round numbers). Indicators: Stochastic: 93. Overbought. Caution. RSI.9 is at 61. Positive. MACD Histogram. Above zero. Positive. MACD. Above zero. Positive. CCI.14: +128.4. Overbought. The 10-DayEMA is above the 20-DayEMA. Positive.
It doesn’t take a genius to see that the Dow 30 is at an important resistance level. It’s held since the 15 March. A break above would be bullish. A big down day would be bearish.
Today in Australia? It’s RBA day. My weekend analysis showed that RBA Day doesn’t have a good record in recent history. 10 out of the last 11 (RBA doesn’t sit in January) were down. The only up day was April, 2012 when it was up only marginally – after being up much higher earlier in the day. That makes for a bearish day. So – don’t expect much today. A 0.25% cut has already been priced in with big dividend paying stocks (e.g., big banks, property, Telstra) moving up last week after the weak CPI number last week. A 0.5% cut might produce a knee-jerk reaction upwards but it will probably be short lived. Why? If the RBA cuts 0.5% it shows that the RBA is worried about the economy going forward (thanks Julia), so the market will take a sanguine view and probably sell off.
If we’re up today, I think it will be at least a short term top. Topping tends to be a process – so a retest of that might be on the cards. If this scenario plays out, the retest will be an opportunity for medium/long term investors to lighten up.
Of course, I could be completely wrong. :) Let’s see how it goes.
(20min delay)