Yesterday was match-up day after options expired on Thursday. That's usually a narrow-range day. Friday didn't disappoint.
Double "hammer" on the XJO suggests a rebound is coming. But, it will probably be weak judging by the relationship of the short-term and long-term stochastics (see top panel).
RSI(5) is down in the "buy" zone but needs to turn up convincingly - that supports the notion that a rebound is coming. The 20-Day MA may provide resistance.
Three of the four banks were up yesterday: CBA +0.4%, ANZ +0.4%, Nab +0.11%. Westpac was the laggard, -0.6%. WBC (like CBA) is holding at a major support level, so there's hope for it.
Telecoms (XTJ) was the best performing sector, +2.7% with Telstra up +2.87%. Next best sector was Consumer Discretionary (XDJ) +1.4%. Domino's (DMP) was a stand-out, +2.83%.
Resources were the worst performers, XMJ -1.1%, Energy -1.3%. They won't be helped by last night's commodities action (see below).
Overnight:
Dow Jones -0.24%, SP500 -0.24%, Nasdaq +0.13%, Russell2000 -0.08%.
Small losses or small gain (Nasdaq) last night. That didn't change the overall pattern which is sideways.
MACDs are rolling over, but still above signal lines. A break below the signal line would bring in “Sell in May”.
SP500:
SP500 remains in a sideways drift. Tuesday’s high is a new pivot high. A break above that would be bullish. Friday's candle is an narrow-range inside day, that denotes indecision. Wait.
The longer time frame shows the XP500 in a wide trading range which developed after the big tantrum in January. The top of the range is at 2787.
While the 200-Day MA holds the bulls will continue to be dominant.
Commodities:
Industrial Metals-0.05%, Energy -2.69%, Gold -0.31%, Iron Ore +2.8%.
The first sub-tropical storm of the season is developing in the Western Caribbean Sea and headed for the Gulf of Mexico. That will shut-down wells in the Gulf and might add more pressure to the upside in the Energy market although that didn't show up last night when Energy fell heavily.
Monday is Memorial Day in the U.S. (That's the equivalent of Australia's Anzac Day.) It's a national holiday so the stock market in America will be closed on Monday.
(20min delay)