Good Morning and Welcome to the XJO Thursday ThreadNews for...

Good Morning and Welcome to the XJO Thursday Thread

News for Today (AEDST)

The XJO continued to respond strongly to the low volume shakeout seen on Monday.
Spread was wider than the previous bar, a positive sign.
Volume was slightly above average, which was necessary for it to push up through the potential resistance that was to be expected from the congestion of closes to the left.
And the close was high on the bar, in fact it closed slightly higher than the Oct 2013 close (the highest recent close), by almost 5 points (4.8).

I recently considered that the push above the high of the 2nd Jan bar appeared to be absorption of supply (from the Oct/Nov 2013 highs) which was thwarting a further move higher.
Mondays bar has potentially shaken out a decent proportion of that supply,
Tuesday then found a potential supply vacuum above which allowed it to move higher quite easily on lowish volume (and offered some confirmation of Mondays shakeout bar),
and Wednesdays bar has now made a new high close.
If my reading of this is correct, and baring any further unforeseen events, the Index will continue to move higher (in a wobbly up and down sort of way).

Taking a point and figure count across the congestion line (potential absorption zone) @ 5425 projects a maximum target of 5570,
a more conservative target is a tick or two above 5500, from the recent activity.

Long Term Charts - U.S. Dollar Index

Good Trading and Investing


cheers