Finspiration Australia.

1/3/23.  Finspiration Tuesday Morning Report.

Overnight, Mixed results in the U.S.

Dow Jones -0.71%.  SP500 -0.3%.  Nasdaq -0.1%.  Small Caps -0.07%.  Banks +0.3%.

Dow Jones was well down, other indices were indecisive with doji candle-sticks.

SP500.

SP500 is oscillating around the 50-Day MA but above the 200-Day MA.  Last Friday looks like a "spring" - a precursor to a trend change to the upside, but we still need to see a decisive move to the up-side to confirm.

It remains below the 8-Day EMA and the mid-line of the Bollinger Bands.  We need to see the SP500 in the top half of the Bollies before feeling comfortable.

It's not unusual after a "Golden Cross" for the market to come back and test the important MAs (50 & 200).  At this stage the test seems to have been successful.

Commodities.  Mixed Results.

Commodities Index +0.3%.  Energy +0.95%.  Base Metals +1.25%.  Agriculture -0.25%.  Gold +0.46%.

After 90 minutes of trading this morning XJO has rebounded from early lows and is now down about >0.2%. The Mining Index is up about +1%.

Bitcoin.

Bitcoin down about -1% overnight.  The crypto is in a sideways consolidation now in the "neutral" zone and oscillating around the 20-Day MA which is basically flat.

The 50-Day MA has crossed above the 200-Day MA which would complete a "Golden Cross", a bullish event.

Finspiration Australia.

 28/2/23.  Finspiration Tuesday Morning Report.

Overnight, U.S. fades from early highs..

Dow Jones +0.22%.  SP500 +0.31%.  Nasdaq +0.63%.  Small Caps +0.2%.  Banks +0.23%.

Lots of doji candle-sticks, lots of intra-day selling last night, lots of indecision.

SP500.

The past two days have seen the SP500 claw back above the 50-Day and 200-Day MAs.  That's a positive.

It remains below the 8-Day EMA and the mid-line of the Bollinger Bands.  We need to see the SP500 in the top half of the Bollies before feeling comfortable.

It's not unusual after a "Golden Cross" for the market to come back and test the important MAs.  At this stage the test seems to have been successful.

Commodities.  Mixed Results.

Commodities Index +0.08%.  Energy -0.33%.  Base Metals +1.01%.  Agriculture -0.1%.  Gold +0.39%.

After an hour of trading, XJO is up +0.65%.

Bitcoin.

Bitcoin up +1.19% overnight.  The crypto is in a sideways consolidation now oscillating around the 20-Day MA which is basically flat.

The 50-Day MA is about to cross above the 200-Day MA which would complete a "Golden Cross", a bullish event.

Finspiration Australia.

27/2/23.  Finspiration Monday Evening Report.

XJO fell heavily today, -1.12%, following the big fall in New York on Friday.

XJO fell below the important 50-Day Ma today.

It remains below the 8-Day EMA.  It first fell below that EMA on 9 February.   I'd stay away until we see at least a break to the upside of the 8-DEMA.

The index is still not down to my preferred support zone - but anything can happen now.  

The Index is oversold with an RSI at 35.22.  CCI is showing a positive divergence - but that doesn't mean much until we see a good upside break.

Energy (XEJ) was the best performer today, +0.3%.  Financials (XXJ) finished flat despite the big fall today.  The killer today was, again, Materials (XMJ), down -3.1%.  With XXJ showing resilience, this market will only need an upside movement from XMJ to start flying to the upside.

European markets are currently up strongly.  German DAX up +1.16%, French CAC +1.11%.

American SP500 Futures are currently up +0.43% - following the Europeans to the upside.

At this stage, it is looking good for Australia tomorrow.

 

Finspiration Australia.

     26/2/23.  Weekend Report - The Week That Was.  Week Ended 24/2/23.

XJO Monthly Chart.

After almost four weeks, XJO down so far -2.27% after stalling at the top of the strong January candle.  XJO has also reached a zone where it has failed in the past.

So far, the Index is above the 8-MEMA, Hull MA13, 50-MMA, 200MMA, Supertrend (7/1.5).  Not much damage done yet.

  

Monthly RSI is at 54.68.  50 represents the dividing line between bullish and bearish.

XJO Weekly Chart.

                                            

XJO remains in an up-trend, with higher highs and higher lows.  In the past five days, XJO fallen -0.54%.

XJO began to fall three weeks ago at a major resistance level.  

8-Week EMA and Hull MA13 turned turned down, which is bearish. Supertrend is providing support at this moment.  Events overnight in America could see a break to the downside of Supertrend.

Weekly RSI is at 55.2 - bullish but falling.  

CCI remains above its zero line (but falling).  It's been above its zero line since 24 Oct. 2022.  That marked the start of this bull market.

XJO Daily Chart.

XJO was in a strong up-trend in January.  It is currently in a short-term down-trend.

Daily RSI has fallen below its mid-line of 50.  That's bearish

XJO may be finding support at the 50-Day MA.   As stated previously, events on Friday in America could see a decisive break below that support level.

Weekly Changes in Sectors.

Despite the fall in the XJO this week of -0.54%, breadth was quite healthy.  Only two sectors fell this week, XMJ (Materials) -2.96% and XDJ (Discretionary) -1.23%.  XSJ (Staples) was flat, +0.09%

A couple of sectors showed quite healthy gains, XUJ (Utilities) +6.05% and XPJ (Property) also +6.05%.

The damage to the XJO was mainly done by XMJ (Materials) after both BHP and RIO presented gloomy reports to the market.  That's largely a result of events in China, where the country was in lock-down for the second half of 2022 - the time covered by the reports from BHP and Rio.  (The biggest markets for those two countries are in China.)

Monthly, Weekly and Daily RSIs. - Sectors + XJO + Gold + Composite Bonds.

This week's chart:

Each sector has three bars representing the RSI on Monthly, Weekly and Daily bases.

The following is a rough guide to interpreting the chart.

Bullish:  Rising bars.

Bearish:  Falling bars.

Counter trend rally:  Falling then rising.

Pull-back:  Rising then falling.

Bullish Sectors: XIJ, XNJ.

Bearish Sectors:  XXJ, XMJ, XEJ.

Counter trend Rally:  XUJ, XPJ.

Pull-back:  XDJ, XTJ, XHJ, XSJ.

XJO is in pull-back mode.  Composite Bonds (IAF) and Gold (XGD) are also in pull-back mode.

NewHighs-NewLows.

This is a long-term indicator, but a good guide for long-term investors.

NH-NL have been pulling back since the end of January.  That's a warning sign to long-term investors to stay defensive,

Stocks v Bonds.  Relative performance.

On a relative basis, Bonds are currently outperforming Stocks, i.e., the chart is below the zero level.

This is a reasonable picture of bullish and bearish status of the market.  It's probably a good idea to remain bearish on stocks while this chart remains below zero.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 42%, This Week 44%.  

2.  % of stocks above 50-Day Moving Average, Last Week 61%, This Week 56%.  

3.  % of stocks above 200-Day Moving Average, Last Week 70%, This Week 65%.

In the short-term, breadth, as measured by stocks above the 10-Day MA, improved a little this week as indicated by the Sector changes shown above.

The longer term measures remain above the 50% mark.  So the market is not in bad shape.

SP500.

I mentioned early in this report, the poor results in America on Friday.  Here's the SP500 chart.

SP500 began a steep decline six days ago and has fallen five of the past six days.  Friday saw a fall of >1%.  That could result in a follow-on fall in the XJO on Monday.

But a lot of strange things are happening in this chart.  Three of the candles show "hang-man" candles.  A small body at the top of the candle and a very long lower wick.  That indicates plenty of intra-day buying.

Although the bears have been dominant in the past six days, bulls have been fighting good rear-guard actions on three of the days, pushing back against the bulls.

The chart is now down to a crucial level.  It bounced strongly off the 200-Day MA on Friday despite the initial big fall.  Such action could spell the end of this push down by the bears.  We need to see a big upside candle on the SP500 on Monday to be confident that this fall is over - at least in the short-term.

It would be very interesting on Monday if the XJO pre-empts the SP500 by rising, or at least showing good strength in intra-day trading

 

Conclusion.

 

February has been a poor month for the XJO.  Although the past week showed a net loss for the XJO, internal strength wasn't nearly as pessimistic as suggested by the -0.54% fall in the XJO.

The long-term trend for the XJO is still bullish with higher highs and higher lows. 

Markets here and in the U.S. are now at a crucial stage.  Watch carefully for events on Monday.

Finspiration Australia.

  24/2/2023.  Finspiration Saturday Report.

XJO up a little, America flops.

Yesterday in Australia.

XJO up yesterday +0.3%.  Ten out of eleven sectors were up.  The only sector down was Materials -1.2%.  So breadth was reasonably positive.  Advancing Stocks: 701, Declining Stocks 609.

Best performers were XIJ (Info Tech) +2.4%, XNJ (Industrials) +1.4%, XPJ (Real Estate) +1.3% and XDJ (Discretionary) +1.2%.

XJO is sliding down the 2 Standard Deviation Bollinger Band - that's bearish.  

I've marked a Support Zone on the chart where I think this market is headed.

Overnight in the U.S.

Dow Jones -1.02%.  SP500 -1.05%.  Nasdaq -1.69%.  Small Caps -0.75%.  Banks +0.2%.

The massive intra-day buying on the Dow on Thursday didn't resolve into a solid upside move last night - just the opposite.  Lots of doji candlesticks litter the other indices above.  That means we still have a battle between the bulls and bears going on during intra-day trading.

SP500.

SP500 has broken below the oblique support line from Dec. 2020.

The chart remains bearish with the index sliding down the lower 2SD Bollinger Band.   

I've marked a possible support zone on the chart.  

Watch which way the market breaks from last night's doji candle-stick.  That might provide some idea of near-term direction.  I doubt, however, that we'll see a change of trend in the near-term.  We need to see a break above the 8-Day EMA to confirm a change on the near-term (bearish) trend.

Commodities.

Commodities Index -0.34%.  Energy +1.39%.  Base Metals -2.22%.  Agriculture -1.46%.  Gold -0.72%.

With the SP500 weak, and Metals prices weak, there's not a lot of hope for the ASX on Monday.

Bitcoin.

Bitcoin was down -3.25% overnight.  It is now sitting in the neutral zone around the 20-Day MA.

Supertrend is bearish.  The chart is below the 8-Day EMA.  Until we see a break to the upside of those two metrics, the line of least resistance is to the downside.

Finspiration Australia.

  24/2/23.  Finspiration Friday Morning Report.

Overnight, U.S. stocks rise after four days of losses.

Dow Jones +0.33%.  SP500 +0.53%.  Nasdaq +0.72%.  Small Caps +0.68%.  Banks +0.32%.

Note the extra long lower wick on the Dow Jones.  That suggests a big change in investor sentiment from bearish to bullish.

SP500.

SP500 showed strong intra-day buying at dual support of the 50-Day MA and oblique support from the December low.  That suggests this pull-back may be over.  But plenty of resistance lies overhead.

Watch for a positive opening tomorrow.

U.S. Commodities were mixed.

Commodities Index +0.76%.  Energy +1.8%.  Base Metals -1.56%.  Agriculture -0.1%.  Gold -0.0.5%.

Iron ore +0.1%.

After 30 minutes of trading this morning, XJO is flat -0.01%.

Bitcoin.

Overnight, Bitcoin was up modestly last night +0.32%, and flat in morning trade.

It remains in a sideways consolidation at the top of its range.  Chances are good for another move higher.

Finspiration Australia.

 23/2/23.  Finspiration Thursday Evening Report.

XJO down today, -0.4%, after poor report from Rio Tinto.

XJO is now sitting at the 50-Day MA, which may provide support.

The market would become a "buy" with a break above the 8-Day EMA.  Until that happens, presume the market is still in a down-trend.  More conservative traders might wait until Accumulation/Distribution (second bottom panel) crosses above its signal line.

On the RSI, the index is now oversold as it is below the 40 level.

Stochastic and CCI are both showing a positive divergence, increasing the chances of a move to the upside.

Rio reported today and the stock fell -1.68%, but that report also took BHP down -3.41%.

As a result, Materials (XMJ) was down -1.6%, and the worst performing sector today.

Currently, European stocks are trading higher and Dow Jones Futures are up +0.32%.  That's looking promising for our market tomorrow.

Finspiration Australia.

 23/2/23.  Finspiration Thursday Morning Report.

Overnight, U.S. stocks mixed.

Dow Jones -0.26%.  SP500 -0.16%.  Nasdaq +0.13%.  Small Caps +0.35%.  Banks -0.34%.

SP500.

SP500 stalled last night at dual support of the 50-Day MA and oblique support from the December low.  That gives the index a good chance of bouncing to the upside.

U.S. Commodities down but Iron Ore up.

Commodities Index -1.3%.  Energy -1.93%.  Base Metals -1.53%.  Agriculture -0.48%.  Gold -0.56%.

Iron ore +1.12%.

After 15 minutes of trading this morning, XJO is down -0.3%.

Rio Tinto reported this morning and in early trade is down >3%, taking BHP with it.  That's the biggest effect on the ASX this morning.

Bitcoin.

Overnight, Bitcoin was down -1.5%, but has been rebounding this morning.

It remains in a sideways consolidation at the top of its range.  Chances are good for another move higher.

Finspiration Australia.

22/2/23.  Finspiration Wednesday Evening Report. 

Again today, like yesterday, we saw the XJO open well down at the opening, but intra-day buying took off most of that selling after the Wages Report came out at 11.30 a.m.  While employment remains strong, wages growth remains muted.  The market took that to mean that pressure has eased on the RBA to raise rates.  So, the market rose at 11.30 a.m., not enough to erase all losses, but the long lower tail on today's candle shows how strong was the intra-day buying.

XJO was down -0.3%.  The bulls are still alive and kicking - but not overcoming the resilience of the bears just yet.

Utilities (XUJ) was the  best performing sector as a result of further news about the take-over of Origin Energy.  XUJ up today +4.8%.

Consumer Staples was the next best performer as a result of Woolies rising +2% after reporting this morning.  Unlike Coles the previous day, there was no backsliding during the day on the WOW price.

Santos also reported and finished u +3.1% and that helped the Energy Sector to finish up +0.9%.

Despite heroics by bulls in the past two days, the trend in the ASX remains to the downside.

A positive divergence on Stochastic suggests we could see some upside.  We need to see a strong bullish candle for that to happen.

In overseas markets, Europe has opened to the downside, but Dow Futures are currently flat.  Anything can happen between now and close of trading in NY.

Finspiration Australia.

 22/2/23.  Finspiration Wednesday Morning Report.

Overnight:  U.S. stocks down heavily.

Dow Jones -2.06%.  SP500 -2%.  Nasdaq -2.5%.  Small Caps -2.98%.  Banks -2.67%.

SP500.

SP500 is now down to a major support level.  After such a big down day, we may see a bounce here.  A lot of resistance lies over-head, so any rally is likely to be sold into.

New York Highs-Lows Cumulative remains bullish - above the 10-Day MA.  That's unlike the OZ NH-NL Cum which is now well below the 10-Day MA.  

Commodities.

Commodities Index +0.13%.  Energy -0.12%.  Base Metals +1.75%.  Agriculture +0.98%.  Gold -0.37%.

After 45 minutes of trading this morning, XJO is down -0.8%.  

WOW reported this morning and is up +1.01%,

Bitcoin.

Bitcoin was down -2.21% overnight but stabilised this morning.  It is consolidating at the top of its range.

Stay with the trend.

Finspiration Australia.

 21/2/23.  Finspiration Tuesday Evening Report.

It was BHP Day today on the ASX.  It reported before the market opened and fell once trading began, to be down around -2%.  But later in the day, buying came into the stock and that led BHP and the ASX to finish with small losses for the day.

First:  XJO.

The XJO was down -0.21% today.  The long lower wick on today's candle shows the extend of the intra-day buying.  

The past todays show doji candle-sticks - indecision.  Coming at the low end of a down trend that could be signalling the end of the trend.  We need to see a bullish candle and a break above the 8-DEMA.  That's the down-sloping grey line which has provided resistance since 9/2/23.

BHP:

BHP finished down -0.33% but finished up well above its opening price.  It has nudged back into "No Man's Land" and marginally above the 8-Day EMA.  That is looking positive.

Coles also reported before the market opened.  It did the opposite of BHP.  Up at the opening and then sold off.

COL remains in the top half of the Bollinger Bands (bullish zone) but today's wide ranging bearish candle looks ominous.  I'm expecting more downside for COL.

The U.S. reopens tonight after Washington's Birthday Holiday.  

Finspiration Australia.

 21/2/23.  Finspiration 11.30 a.m. update.

RBA held no nasties for the market.  After the minutes were released, the market barely moved.  At 10.45 a.m., XJO is down -0.5%.

BHP has remained around the -2% down.  Currently at -1.9%.

The big mover this morning has been Coles.  Shortly after opening this morning, Coles was up about +0.8%.  The market has re-assessed its report and Coles is now down -1.8%.  That's a big intra-day fall.

Inspiration Australia.

21/2/23.  Inspiration Tuesday Morning Report.

U.S. Markets closed overnight.  Europe markets little changed.

The big changes for Australia this morning were reports from BHP and Coles.

At 10.10 a.m., BHP was down about -2% but jerking around trying to find a base price..  Coles up, about +0.7%.

XJO is down -0.6%.

Gold flat overnight, -0.09%.  Bitcoin up about +0.4%.

RBA minutes due at 11.30 a.m. Summer time.  I'll give an update on the market soon after that time to see if any reaction occurs.

Here's a summary from Reuters of the BHP report:

Global miner BHP Group (BHP.AX) was positive about demand outlook through to fiscal 2024 as top metals consumer China reopens and shifts policy towards its debt-laden property sector, the company said on Tuesday after its 2023 first-half profit missed estimates.

However, its interim dividend of 90 cents per share, while lower than last year's $1.50 per share, beat Vuma Financial's estimate of 88 cents.

Finspiration Australia.

 20/2/23.  Finspiration Monday Evening Report.

A "nothing" day today on the ASX.  XJO up +0.06%.  It was a narrow range day with a doji candlestick.

XJO remains short-term bearish.  Today's action is marked by that tiny little cross at the end of the down-trend.

Tomorrow, the NY Stock Exchange is closed for Washington's Birthday.  That probably explains the lack of interest in our market today.

Let's see what tomorrow brings.  Among other things, BHP reports tomorrow - that could be market changing.

Finspiration Australia

    19/2/23.  Weekend Report - The Week That Was.  Week Ended 17/2/23.

XJO Monthly Chart.

After almost three weeks, XJO down so far -1.74% stalling at the top of the strong January candle.  XJO has also reached a zone where it has failed in the past.

So far, the Index is above the 8-MEMA, Hull MA13, 50-MMA, 200MMA, Supertrend (7/1.5).  Not much damage done yet.

  

Monthly RSI is at 55.26.  50 represents the dividing line between bullish and bearish.

XJO Weekly Chart.

                                            

XJO remains in an up-trend, with higher highs and higher lows.  In the past five days, XJO fallen -1.17%.

XJO began to fall two weeks ago at a major resistance level.  

8-Week EMA has turned down, which is bearish. Hull MA13 and Supertrend remain in bullish configurations, so not a lot of damage done yet.

Weekly RSI is at 56.87 - bullish but falling.  

Stochastic was showing a negative divergence and has now turned down below its signal line.  That could mean more downside.

XJO Daily Chart.

XJO was in a strong up-trend in January.  It is currently in a short-term down-trend.

Daily RSI has fallen below its mid-line of 50.  That's bearish

The indicator overlays on the chart (8-DEMA, Hull MA and Supertrend) are all negative.  The chart remains, however, above the longer term MAs:  50 and 200.  This may be a pull-back within the longer up-trend.

Monthly, Weekly and Daily RSIs. - Sectors + XJO + Gold + Composite Bonds.

This week's chart:

Only four sectors are above 50 on the One-Week RSIs.  

Bullish sectors with RSIs arranged in ascending order are:  XDJ, XIJ, XSJ.  That's the same as the previous week

Sectors in negative mode (Daily RSI below Weekly RSI, Weekly RSI below Monthly RSI) XXJ, XMJ, XEJ, XUJ.  That's eight out of eleven sectors.

Sectors in pull-back mode are:  XHJ, XPJ, XNJ, Gold (an industry group within XMJ) is alsoin pull-back mode. 

NewHighs-NewLows Cumulative.

This is a long-term lagging indicator, but a good guide for long-term investors.

NH-NL Cum is represented by the blue line.  It is now marginally below the 10-DAY MA but remains well above the 21 and 34 Day Moving Averages.  That's a warning signal - it might be time to take defensive action for long-term investors.

I've developed another long-term metric "StrongStocks-WeakStocks" which is similar to NH-NL but gives signals a little earlier than NH-NL  SS-WS is up for the 14th week in a row and has moved well above its 5-Week MA.   This week there were only 22 Strong Stocks compared to 6 the previous week.  Weak stocks rose to six.   

While this remains above its 5-Week MA, long-term investors might ignore the NH-NL chart.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 26%, This Week 42%.  

2.  % of stocks above 50-Day Moving Average, Last Week 61%, This Week 61%.  

3.  % of stocks above 200-Day Moving Average, Last Week 71%, This Week 70%.  

Stocks above 200-Day MA have fallen from 71% to 70% but remains at the 5-Week MA.

The short-term metric has risen strongly this week, so breadth is not as poor as the XJO might suggest.

 

Conclusion.

 

Daily chart of XJO was in a strong uptrend.  That has now now reversed into pull-back mode.

The long-term trend, however, is still bullish with higher highs and higher lows.

I've remarked on my daily reports that a "hidden divergence" is in play on the XJO.  That's a continuation signal.  We need to see a strong bullish candle on the daily chart to confirm a change from downside back to upside.

I'm still sanguine about the prospects of our market.  I think this is the pull-back we had to have (apologies to Keating) after a strong January.  A lot of stocks are getting back to levels where an upside move can be expected.  Short term breadth has improved. But, until proven otherwise, the short-term trend is down.

Finspiration Australia.

 18/2.23.  Finspiration Saturday Morning Report.

Yesterday, ASX down.  Overnight U.S. mixed.

XJO yesterday.

XJO down -0.86% yesterday.  It remains in a down-trend with the chart stuck in the lower half of the Bollinger Bands, below the 8-Day EMA and below the Supertrend Line.

The hidden divergence remains in play (higher low on the chart, but lower low on Stochastic).  That suggests that the Index will resume its primary up-trend.

For that to happen, we need to see a bullish candle on the chart and for RSI to close above its mid-line and for Accum/Distribution (lowest panel) to break above its MA.

Overnight in America.

Dow Jones +0.39%.  SP500 -0.28%.  Nasdaq -0.58%.  Small Caps +0.13%.  Banks +0.00%.

SP500.

SP500 finished in "No Man's Land", that's the narrow Bollinger Bands in the above chart.

Today's candle is a "dragonfly doji" - opening and closing at the same level.  That shows good intra-day buying.

The opening was a gap down from the previous day's candle.

A dragonfly doji, after a gap down, at the end of a down-trend, often suggests a weakening of the bears and a strengthening of the bulls.  That could signal an end to the down-trend.  A big up-day next is required to confirm.

Commodities.

Commodities Index -0.75%.  Energy -1.63%.  Base Metals +0.84%.  Agriculture +0.49%.  Gold +0.3%.

Gold shows a bullish engulfing candle coming at the end of a down-trend.  That could signal the end of the down-trend.

BITCOIN.