spreading the risk - wednesday, page-29

Above is a Candle Stick chart for the XJO.

Summary of major indices In Australia today:

Twenty Leaders -2%
50 Leaders -2%
XJO -1.9%
XAO (All Ords) -1.7%
Small Ordinaries -0.6%
Financials (ex Property Trusts) -2%
Materials -2.6%
Consumer Staples -2.3%
Energy -1.7%
Health -1.8%
Telecoms -1.6%
Consumer Discretionary -0.6%
Utilities -0.0%

Comment: Yesterday was extraordinary. Today almost matched it, in the reverse direction. Any day when the 50 Leaders is down -2% is highly unusual. Volume again was on the light side. Are we catching the 4th July bug – and laying off any trading? UpVol/DownVol Ratio yesterday was an exceptionally high 89%. UpVol/DownVol today was poor at 27%. I thought that if yesterday was “for real” – we’d have to see good follow through today. We didn’t.
Technical Comment on the XJO (closed at 4744.1):
Major horizontal Resistance: 4891.4. Horizontal Support: 4550

Indicators

RSI9: 45.7. Rolling over and well below 50. Negative.
MACD Histogram. Marginally above zero. Neutral.
MACD: Above zero. Positive.
Stochastic: 57. Below its signal line. Negative.
CCI.14: +5.6. Marginally above zero and falling. Neutral.

We’ve had two sucker days in a row. Which one do you believe?

Looking at the chart, this can go either way. There might be a bit more in the upside. But then the index runs into the 40-Day TMA currently at 4898.5, horizontal resistance at 4891.4 and oblique resistance currently at 4878.9. That’s a triple resistance. Hard stuff to overcome.

Redbacka