Finspiration Australia. Chart Analysis of Australian and International Stock Markets

 1/6/22.  Overnight.

Major U.S. indices finish lower.  End of month book squaring resulted in high volumes.

Dow Jones -0.67%.  SP500 -0.63%.  Nasdaq -0.41%.  Small Caps -1.07%.  Banks +0.22%.

Positive economic news out of the U.S. resulted in rises in U.S. Treasuries - that was a negative for stocks.  Hawkish comments by Fed Governor Waller on future interest rate rises didn't help matters.  

SP500.    

SP500 is in a short-term up-trend, but longer term it remains bearish.  Until we see a decisive move above the cloud, this must still be considered a counter-trend rally.

Commodities.

Commodities Index -0.69%.  Energy +0.18%.  Base Metals -0.79%.  Agriculture -1.92%.  Gold -0.99%.

Overnight Oz Futures finished down -0.36%.  The ASX can expect a weak opening this morning.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets.

31/5/22.  Last day of the month today and XJO fell -1.03% after being up yesterday +1.45%.  For the month of May, XJO was dow n -3.01%.  Seasonally, June tends to be flat.

The short-term trend remains up, but that looks increasingly in danger with resistance from the joint 50/200 DMAs just over head.

Tonight, trading returns to the U.S. after being closed for Memorial Day holiday.

Tomorrow, Australia sees release of GDP figures.  Those figures could be market changing.  A poor number could be good for the market, a good number could be bad for the market (because of effects on interest rates, one way or the other.)

Finspiration Australia. Chart analysis of Australian and International Stock Markets.

 30/5/22.  XJO up strongly today.

XJO up +1.45%.

Today's strong result pushed the XJO our of its short-term consolidation, and up to the next level of resistance.

Given that America is closed for a holiday tonight, we can't expect much tomorrow.  Consolidation is the best bet.

Breadth today was good, with the ASX A-D Line rising above the 10-DMA for the first time since mid-April while still consolidating.

Expect consolidation in our market tomorrow while the U.S. is no holidays.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets.

    Weekly Wrap - Week ending 27 May, 2022.

XJO Monthly Chart.

The monthly chart is range bound 6970-7630.  

The chart is currently above the 8-month EMA but it is essentially sideways as indicated by the two flat Supertrend lines, one above and one below the monthly candles.  

The MACD Histogram also indicates a flat or sideways market, with the Histograms almost non-existent for the past three months - hugging the zero line.

Weekly Chart.

XJO was positive this week, +0.52%, after being up +1% the previous week

The chart is range bound, in concert with the monthly chart.  

Medium term, the chart the chart remains bearish..  Hull MA13 is blue (bearish); two Supertrend lines are blue (bearish) and the chart is below the 8-Week EMA is heading down (bearish).  RSI and CCI are below their mid-lines (bearish) and Stochastic has fallen below its signal line (bearish).

The chart is, however, rising from the lower edge of the range

The chart shows a trading range in round figures from 7630 to 6930.  This week XJO finished at 7182.  

Daily Chart.

Looking at this chart, it doesn't take a genius to see that the past week or so has been in a sideways trend.

All three charts, monthly, weekly and daily are in sync, sideways within sideways.  Let's see of the daily chart can break out of its short-term range.

The confluence of the 50/200 DMAs suggests that any rise is likely to be short-lived.

Sector Changes - past week.

This chart shows the performance of each sector (plus Gold Miners, XJO, BEAR and IAF) over the past week.  

Despite the positive rise this past week, the Market is unbalanced, with four sectors up, one flat and six down.  Resources (Materials XMJ +1.78. Energy XEJ +2.14%) and Financials (XXJ +1.31%) were largely responsible for the positive ASX return this week.  XMJ and XXJ are, of course, the two biggest sectors in the market, and have an outsized impact on where the market heads.   

Information Technology (XIJ -3.43%) and Consumer Staples (XSJ -2.2%) were the worst performing sectors.  They represent two edges of the equity spectrum (from growth to defensive) so the market was a bit indecisive from that point of view.  Commodity based sectors (Materials and Energy) remain the places to be.

New Highs - New Lows Cumulative.

This is one of the important breadth indicators.  Unless breadth is solidly positive, the market is always under threat.

NH-NL Cumulative continues to fall and is now well under its 10-Day Moving Average, that's a big red danger sign for long-term investors.  

ASX Advance-Decline Line.

This is another important indicator of breadth.

Like NH-NL Cum, ASX Advance-Decline Line is also bearish, but not quite as bleak as NH-NL Cum.

It is, however,  below its 10-DMA and its 20-DMA.  

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 74%, This Week 52%.

2.  % of stocks above 50-Day Moving Average, Last Week 38%, This Week 30%.

3.  % of stocks above 200-Day Moving Average, Last Week 40%, This Week 37%

This is another indicator of weak breadth.  Despite the rise in the XJO the %age of stocks above key Moving Averages fell this week.

Weak breadth is often a leading indicator for falls in the market.

Conclusion.

1.  Monthly, Weekly and Daily charts in sync - non-trending.  (Traders will play the ranges)

2..  Breadth is poor, so the most likely direction is down.  If breadth continues to be poor, we can expect a break down from the ranges, and a continuation of the bear market.  Perhaps not this week, but its not far off.

3.  50/200 DMAs are almost connected - that's stiff resistance.  Any rise is likely to be short-term when the XJO hits dual resistance of those two major MAs.

Finspiration Australia. Chart Analysis of Australian and International stock markets.

 28/5/22 Yesterday in Australia.

XJO remains in a bearish PRT band and sitting at horizontal resistance at 7813.  Given events overnight, XJO is highly likely to breach resistance and could be above the Medium Term Line of the PRT Bands.

Overnight.

Dow Jones +1.76%.  SP500 +2.47%.  Nasdaq +3.33%.  Small Caps +2.31%.  Banks +1.27%.

SP500.

SP500 has completed a double bottom and is above its Mid Line.

It remains in a bearish PRT Band, with a major resistance level just over-head at 4170.  That might result in some consolidation, but further ahead is looking likely, with the next target at 4306.  

Commodities.

Apart from Gold (flat +0.05%),  Commodities had good rises overnight in sync with equities.

Commodities Index +1.19%.  Energy +1.5%.  Base Metals +1.62%.  Agriculture +0.63%.

NY Advances-Declines Line.

NY A-D Line is in a clear short-term up-trend above both the 10DMA and 20DMA.   10DMA x-over above the 20DMA is imminent.  That's a bullish indicator.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets.

 27/5/22.  Overnight.

Dow Jones +1.61%.  SP500 +1.99%.  Nasdaq +2.69%.  Small Caps +2.11%.  Banks +2.42%.

SP500.

SP500 is coming up to the first line of horizontal resistance at 4087.  The current momentum should be enough to overcome that.  The next line of horizontal resistance is at 4176 which might be harder to overcome.  That's a major resistance level and coincides with the Kijun Sen (Base Line) of the Ichimoku.  Together, they will provide stiff resistance to further upside.  But we'll deal with when, and if, it happens.

Commodities.

Commodities Index +1.09%.  Energy +1.79%.  Base Metals -0.09%.  Agriculture +1%.  Gold -0.19%.

Commodities Index is at a major horizontal resistance zone.  If it can overcome that we should see much higher prices.  Some commentators are talking about a Commodities Super-Cycle.  We could be seeing the beginning of that.

Iron Ore -0.7%.  Thermal Coal -0.4%.

After 10 minutes of trading, XJO is up +1.2%.  Information Technology and Consumer Discretionary are doing best.  These are risk-on sectors, which is a good pointer to further upside.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets.

 26/5/22.  XJO fell today.

XJO fell today -0.69%.  It has broken down from a horizontal resistance level at 7170.  XJO finished today at 7105.9.  That fall coming at resistance is not encouraging.

Some time ago I mentioned that I had a turn date of 26/5/22 based on W.D. Gann timing principles.  I'm never very confident about such projections, but this one looks likely to succeed.

Finspiration Australia. Chart Analysis for Australian and International Stock Markets.

26/5/22.  Overnight.

Dow Jones +0.6%.  SP500 +0.95%.  Nasdaq +1.51%.  Small Caps +2.05%.  Banks +1.66%.

SP500.

SP500 continues to consolidate at the low end of the current down-trend.  

Positive divergences on indicators in the lower panes suggest the next move will be up.

Commodities.

Commodities Index +0.71%.  Energy +1.65%.  Base Metals -0.52%.  Agriculture -0.5%.  Gold -0.6%.

Iron Ore +0.2%.  Thermal Coal -0.8%.

Overnight Oz Futures were up modestly +0.2%.

 

Finspiration Australia. Chart Analysis for Australian and International Stock Markets.

 25/5/22.  Yesterday in Australia.

XJO was down -0.28%.  It remains in the Blue Band on the PRT Bands (bearish), oscillating around the Short-term Line and below the Medium-Term Line.  

The index remains in its wide trading range, so we'll probably see some more upside.

Overnight.  Mixed results in the U.S.

Dow Jones +0.15%.  SP500 -0.81%.  Nasdaq -2.35%.  Small Caps -1.11%.  Banks -0.52%.

Technology stocks were adversely affected by a drop of >40% in Snap which reverberated through other social media stocks.

SP500.

SP500 is at the low end of the bearish, blue PRT Band.  The positive divergence on the CCI keeps promising a move to the upside, but the Index has a lot of work to do before becoming bullish.

Commodities.

Commodities Index flat -0.07%.  Energy +0.25%.  Base Metals -0.91%.  Agriculture continues its down-trend -1.2%, but mind find support here.  Gold +0.75%.

Iron Ore -0.9%.  Thermal Coal -0.9%.

The XJO has opened up a little +0.2%.

BHP has opened down almost -10%; that's related to its merger with WPL.

Inspiration Australia. Chart Analysis of Australian and International Stock Markets.

24/5/22.  Overnight.

 Dow Jones +1.99%.  SP500 +1.86%.  Nasdaq +1.59%.  Small Caps +1.07%.  Banks +4.08%.

That move by the Banks takes the Index back up to the 20-DMA where it has failed before.  A decisive move up above the 20-DMA would be encouraging for the bulls.

SP500.

Monday's action shows follow-through buying from the intra-day buying on Friday.  

All lower indicators show positive divergences, with the double divergence on MACD and Histogram a very bullish sign.

Commodities.

Commodities Index +0.75%.  Energy +0.88%.  Base Metals +0.96%.  Agriculture +0.9%.  Gold +0.47%.

Iron Ore -0.1%.  Thermal Coal -0.3%.

After 10 minutes of trading on the ASX, XJO is flat, up just 0.04%.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets.

Australia is in a new era after nine years of Liberal/National governance, Labor has taken control and Anthony Albanese is now Prime Minister.  Historical data from Commsec suggests the market will be up one week and three weeks after the election.  As always, history is no guarantee of gains in the future.

Today, the XJO was flat.  Up +0.05%.

 XJO remains knocking on the door of an upside trend change.  Today's tombstone candle which indicates intra-day selling isn't a vote of confidence.

We need to see all three Supertrend Lines into yellow.  Currently we've got two yellow and one blue.

MACD is also knocking on the door of a trend change.  We need to see that histogram change from blue to yellow.

Hopefully we will see three yellow in the near future.  But hope doesn't work in the market.  Let's wait and see how it pans out.

Finspiration Australia. Chart Analysis of Australian and International Stock Marke

   Weekly Wrap - Week ending 20 May, 2022.

XJO Monthly Chart.

After three weeks of May, the monthly chart is range bound 6970-7630.  

The chart is currently below the 8-month EMA but it is essentially sideways.  

We need about another week of data to see how the Monthly chart is travelling

Weekly Chart.

XJO was positive this week, +1%, breaking four weeks in a row to the downside.

The chart is range bound, in concert with the monthly chart.  Medium term, the chart the chart remains bearish..  Hull MA13 is blue (bearish); Supertrend (1.5/7) is blue (bearish) and the chart is below the 8-Week EMA is heading down (bearish).  RSI and CCI are below their mid-lines (bearish) and Stochastic has fallen below its signal line (bearish).

The chart is, however, at the lower end of the range so we'll probably see a move to the upside in the coming week.

The chart shows a trading range in round figures from 7630 to 6930.  This week XJO finished at 7075.  

Daily Chart.

In the short-term, this chart is looking positive.  Indicators in the lower panels have turned up; Hull MA13 and Supertrend (1.5/7) in the top chart are also bullish.

The chart has now formed a higher low, that's half-way to concluding a new up-trend.  We still need to see a higher high to complete the criteria for an up-trend.

The daily chart is, thus, out of sync with the weekly chart - that's typical in a range-bound market.

Sector Changes - past week.

This chart shows the performance of each sector (plus Gold Miners, XJO, BEAR and IAF) over the past week.  

Pluses and minuses for sectors were evenly spread with six sectors up and five sectors down.  Materials (XMJ +3.65%) had a return to form as did Information Technology (XIJ +5.04%).  

Consumer Staples (XSJ -3.45%) was the worst after a poor report from Woolworths (WOW -6.08%) and a big fall in URW -7.87% after a big sale of stock under market value.

New Highs - New Lows Cumulative.

NH-NL Cumulative continues to fall and is now well under its 10-Day Moving Average, that's a big red danger sign for long-term investors.  

ASX Advance-Decline Line.

Like NH-NL Cum, ASX Advance-Decline Line is also bearish, but not as bleak as NH-NL Cum.

It is nudging on its 5-Week Moving Average and another good week would take it over that metric.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 20%, This Week 74%.

2.  % of stocks above 50-Day Moving Average, Last Week 36%, This Week 38%.

3.  % of stocks above 200-Day Moving Average, Last Week 33%, This Week 40%

Two out of three are below 50% level - which confirms the bearish status of the ASX.  This week's bounce has resulted in a bounce in the shortest term metric.  That could be the start of a medium-term trend reversal.

Last week I noted:   This is the second week in a row where %Stocks above 10-DMA has been 20% or below.  That's another contrarian signal for a short-term bounce.  We got that bounce this week.

The above chart compares the performance of XSJ Consumer Staples (yellow and blue candles) with XDJ Consumer Discretionary (blue and grey candles).  

If consumers are confident about the economy, they are usually happy to splurge on big ticket, discretionary items - companies such as Harvey Norman, JB Hi-Fi and car retailers.  If consumers are not so confident about the economy, consumers tend to delay buying big ticket items.  

Conclusion.

1.  Weekly and daily charts out of sync - typical of a range-bound market.  Traders will play the ranges.

2..  Short to medium term is looking good for further upside.  We've probably seen a bottom in the medium-term.

I gave three beaten down stocks as tips last week ALL, REH, JHX.  

     ALL:  Buy at or above 33.06.  Stop Loss at 31.64.

     REH:  Buy at or above 16.00.  Stop Loss at 15.02.

     JHX:  Buy at or above 40.64.  Stop Loss at 39.06

ALL triggered a buy on Thursday when it hit 33.06.  It finished Friday at 35.17.  That's a gain of +6.4% so far.  Move stop up to break even at 33.06.  Continue to move the stop up if ALL continues rising.

REH triggered a buy stop on Monday at 16.00, but continued to fall the rest of the week.  Stop Loss still not triggered.  REH is currently sitting on a loss of -3.4%.

JHX didn't trigger a buy stop.  No trade.  Forget about JHX,

From the two trades, we're sitting on a gain of +3%.

Finspiration Australia. Chart Analysis for Australian and International Stock Markets.

21/5/22.  Yesterday In Australia. 

Strong day on the XJO yesterday, up +1.15%.  XJO has now formed a higher low.  We still need to see a higher high to meet the definition of an up-trend.

Tenkan Sen (Conversion Line - Blue) is now acting as support for the XJO.

Overnight.

Dow Jones +0.3%.  SP500 +0.01%.  Nasdaq -0.3%.  Small Caps -0.37%.  Banks -0.06%.

Flat finish in the U.S. after intra-day buying erased most of the early buying and producing "hanging man" candlesticks on all of the above indices.  That often occurs at or near the end of down-trends.

SP500.

SP500 continues to sketch out a possible bottom for this down-trend.  Positive Divergence on CCI gives further optimism to that view.

Any rally is likely to be a counter-trend rally until proven otherwise.

Commodities.

Commodities Index +0.14%.  Energy +0.62%.  Base Metals +0.31%.  Agriculture -0.67%.  Gold flat +0.07%.

NY Advance-Decline Line.

NY A-D Line remains in a down-trend.  Stay defensive until we see this change to an up-trend.

Finspiration Australia. Chart Analysis for Australian and International Stock Markets.

20/5/22.  Overnight.

 Dow Jones -0.75%.  SP500 -0.58%.  Nasdaq -0.26%.  Small Caps -0.49%.  Banks -0.45%.

SP500.

SP500's candle last night was a doji spinning candle, so it could be sketching out a double bottom.  It still has a lot of work to do to confirm that, but it does look promising.

Commodities.

Commodities Index+1.27%.  Energy +1.13%.  Base Metals +3.54%.  Agriculture -0.04%.  Gold +1.47%.

Iron Ore +0.9%.  Thermal Coal flat 0.0%.

After 20 minutes of trading this morning, XJO is up 0.6%.  So it looks like a strong day today going against the trend set by America last night.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets.

 19/5/22.  After big falls in the U.S. last night, Oz market down heavily today, -1.65%.

The short-term trend is undecided, with two Supertrend Lines positive and one negative.

Hull MA13 remains positive.

The past few days have seen a drop off in Volume.

This suggests that the retail traders are largely finished their selling and sitting out of the market - or just holding on.  The market is now largely the play-thing of the big institutions, so, if we see a rebound, it should be significant.

Until we see an improvement in breadth, stay defensive.  (See charts below.)