XJO Weekend Charting and Chat - 09 Feb 2018, page-10

In Australia Yesterday:



XJO down -0.89%.

The index is oscillating around the 200-Day MA, which is a major marker between the bull/bear state.
So far major support at 5786.

A positive divergence on the short-term Stochastic suggests we’re at a low, but other indicators have not yet given any positive signals.

Wait for a re-entry signal.

Overnight:

The four major American indices had a major bullish reversal last night shown by the long-tailed “hammer” candle. Volume was very heavy. The reversal occurred in the afternoon session and had the hall-marks of institutional activity. RSI shows a potential double-bottom. We need confirmation of a strong up-day.



Dow Jones +1.38%. SP500 +1.49%. Nasdaq +1.44%, NYSE +1.1%, Banks +1.98%, DAX -1.25%.

26 out of 30 Dow Jones components were positive. So the advance was broadly based.

SP500



SPX has bounced strongly off the 200-Day MA. Today’s “hammer” candle is a bullish reversal signal which needs confirmation of a strong up day.

We still have no re-entry signal. The trend channel remains steeply down. It’s best to wait for the trend channel to turn up.

Commodities:

Commodities were down strongly. DBC -1.47%. Energy -2.18%. Gold -0.17% and Industrial Metals -1%. Copper Producers +1.19%.

Overnight BHP was up +2.23% and Rio was up +2.77%. Woodside +0.04%. Westpac +1.6%. All four stocks showed daily “hammer” candles. The bullish reversals occurred in sync with the broad American market.

The action overnight suggests this correction is over.

My regular weekly report should be up tomorrow.