Finally get our double top on the XAO (well, almost!)Now...

Finally get our double top on the XAO (well, almost!)

Now where?

My first thoughts were that we will hit resistance here and then break to the downside (perhaps significantly) given the potential for so much bad news in the 4th quarter.

What has been the standout for me regarding 2012 in Oz is just WHERE the gains have been:
Health +32% (CSL +43%)
Finance +19% (WBC +29%, ANZ +24%, CBA +15%, NAB +13%)
Telcos +18% (TLS +18%)

Energy + Materials have gone backwards (incl BHP -3%, RIO -9%), and whilst the XJO and XAO are up 10%, (the ASX Top 50 close to 12%), the Small Ords have risen only 4%.

In the US, the gains are much more even across the board (small caps up 13%, SP500 +14% and no industries in negative territory, with Energy Materials up close to 6%).

What does all that mean? Mmmm... scratches head.

No idea, although suggests to me that we continue to be more wary of risk here, with an almost blinkered focus on blue-chip, high dividend yield stocks (esp. Financials) and less-willing to invest in the smaller end of town than our US cousins. (No $&"# Sherlock!!)

But, we have also had reasonable risk-free bank interest rates to look after much of our cash and the RBA is taking action to reduce the desirability of this option.

Our dollar is also starting to head south, making overseas investments more expensive.

And these high-dividend paying stocks are starting to look pretty expensive.

So where to put your hard-earned?

Will this actually help other ASX stocks over the next 3-6 months?

Or is it time to cash in the chips and sit on the sidelines until we see the outcome of Romney/Obama and the Fiscal cliff??

Interested in the thoughts of the XJO thread eXperts.

Thx