redbacka's - boom boom tuesday, page-153

XJO (ASX200) +1.1%
XTL (Twenty Leaders) +1.1%
XFL (Fifty Leaders) +1.1%
XFJ (Financials) +1.5%
XMJ (Materials) +0.5%
Energy +1.2%
XSO (Small Ordinaries) +0.7%

Comment: A ragged day, up, down and then up. The morning was dominated by trading - but the afternoon rally looked like it had some oomph in it. Volume was up a little on the previous day. Not much. Given that Monday tends to be a low volume day, it makes today's volume look a little suspect. The laggard today was the Materials Sector - not a good sign.

INDICATORS:
RSI.9: 43.6. Rising from below 30.
MACD Histogram. Above zero. Positive
MACD . Below zero. But hooking up from a low level.
Stochastic: 19.1. Above it signal line. Needs to cross above 20 confirm.
CCI.14: -63.5. Crossed above -100. Positive.

All indicators have turned up and some are well into positive territory. That provides the bulls with some promise.

The neckline of Head'n'Shoulders patterns often proves to be significant resistance. I've put a question mark just below that level. A failure there would mean further falls.

At this stage, the reversal upwards has now had two days. A third day up is probable, but some hesitation can then be expected. The chart needs to get above the H'n'S Neckline to prove its power. That level is also around the 44-Day EMA (the red dotted line). That proved to be significant resistance on the way down from April, and then coincided with support of the H'n'S pattern. So that's an important level to watch.

Redbacka