Finspiration Australia.

     5/3/23.  Weekend Report - The Week That Was.  Week Ended 3/3/23.

XJO Monthly Chart.

We've only had three days in March with the XJO up +0.35%.  In February, XJO was down -2.92%

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 54.31.  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 -0.32%.  The previous week it was down -0.54%.  So down side over the past two weeks has been modest.

This week saw good buying during the week to erase most of the early losses.

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

8-Week EMA and Hull MA13 turned turned down, which is bearish. Supertrend continues to provide support this week.  Events overnight on Friday in America could see a break to the upside.   

Weekly RSI is at 54.2 - bullish but falling.  

XJO Daily Chart.

This week, XJO was behind the eight-ball with a big fall on Monday.  It has been up three of the past four days.

My shortest term moving average is the Hull MA13.  It turned down on the 9 Feb.  It has now turned up, so the down-trend could be ending.

I'd like to see the index finish above the 8-Day EMA (grey line) before feeling confident that the short-term trend has turned up.  That seems likely to occur on Monday, given events in the U.S. on Friday night.

Weekly Changes in Sectors.

Breadth was poor this week, with only two sectors pushing to the upside - but those two sectors did extremely well, Energy +5.19% and Materials +3.98%.

Financials, the biggest sector in the ASX, was down heavily -2.88%.  It has been doing very poorly in recent times, but could be coming to the end of its pull-back.

On the Thursday, XXJ fell heavily taking its RSI down to 26.6.  We rarely see the RSI for XXJ get below 30 before we get some sort of a rebound.  Watch XXJ on Monday for some good news for our market.

Gold Miners.

XGD (Gold Miners) was one of the stand-outs this week, up +6.42% after being down five weeks in a row.  The bullish engulfing candle for this week suggests more upside for the Gold Miners.  It has also bounced off support of the 50-Week MA - another bullish sign.

NewHighs-NewLows.

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

NH-NL pulled to the upside this week, with the 3-Day MA rising sharply.  The 3-Day MA needs to get back above the 20-Day MA for long-term investors to feel comfortable about their investments.  Until that happens, 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 for medium term investors to remain bearish on stocks while this chart remains below zero.  If you're a bit cheeky, you might go long if the chart rises above the 10-Day MA.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 44%, This Week 40%.  

2.  % of stocks above 50-Day Moving Average, Last Week 56%, This Week 55%.  

3.  % of stocks above 200-Day Moving Average, Last Week 65%, This Week 61%.

The longer term measures remain above the 50% mark.  So the market is not in bad shape.  Short-term I'd like to see Stocks above 10-DMA move back above 50%.

SP500.

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

The past two sessions on the SP500 have seen strong upside moves.    Friday saw a rise of +1.61%.  That triggered a number of bullish indicators.  

Thursday saw the SP500 bounce strongly off the 200-Day MA - that's a bullish indicator.  Friday saw the index cross above the 8-Day EMA, and the Supertrend changed from blue to yellow - bullish.  Hull MA13 has turned up - bullish.

This looks like the start of a good short-term upside rally.

 

Conclusion.

 

A lot of jig-saw pieces are falling into place for our market in the coming week.  SP500 has turned short-term bullish and we should follow suit on Monday.

Finspiration Australia

   12/2/23.  Weekend Report - The Week That Was.  Week Ended 10/2/23.

This week has seen a dramatic change in investor sentiment.  The previous week, the market was all gung-ho and seriously overbought.  This week, investors sobered up and a pull-back has started.

XJO Monthly Chart.

We've only had ten days so far in February.  XJO down so far -0.58% 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 10-MMA, Hull MA13, 50-MMA, 200MMA, Supertrend (7/1.5).  Not much damage done yet.

  

Monthly RSI is at 56.57.  50 represents the dividing line between bullish and bearish.

XJO Weekly Chart.

                                            

In the past five days, XJO fallen -1.65%.  

The weekly chart shows a bearish engulfing candle.  That's occurred at a major resistance zone.

Candlesticks are a graphic depiction of buying and selling in the market.  A big dark engulfing candle shows the sellers were in complete control of trading this week.

8-Week EMA, Hull MA13 and Supertrend remain in bullish configurations, so not a lot of damage done yet.

Weekly RSI is at 60.58 - bullish but falling.  

Stochastic was showing a negative divergence and has now turned down below its signal line.

XJO Daily Chart.

XJO was in a strong up-trend in January.  That's all changed now.

Daily RSI is now at 53.71 - that's well below the weekly RSI of 60.58.  A fall by the Daily RSI below the Weekly RSI is indicative of a pull-back.  That's not something to trade from - but a filter to alert you to look at the charts and trade the charts.

Daily RSI remains above the bullish level of 50.

The indicator overlays on the chart (8-DEMA, Hull MA and Supertrend) all indicate the dramatic nature of the reversal that's occurred in the XJO.

STW Daily.

XJO can be a bit deceptive on a chart as it always opens at the same level as the previous day's close.  Never any gaps on an XJO chart.

STW is a tracking ETF for the XJO and can often give clues as to investors' thinking not available from the index.

The above chart shows a big gap opening to the down-side on Friday and breaking below key indicators (8-DEMA, Hull MA and Supertrend).  That's a key sign that a trend reversal has occurred.

Of course, the market always tries to play with the minds of investors.  Looking at the right hand side of the chart, an investor might think that further downside is immediately probable.  But looking at the left hand side of the chart shows a key support at 67.08.  STW closed at 67.07 on Friday - so we might get some upside here before another move to the downside.  

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

This week's chart:

In the week prior to this now, five sectors out of eleven were 70 RSI.  Now there are none, with only one sector above 60 - XXJ - but it is also in pull-back mode.   

Bullish sectors with RSIs arranged in ascending order are:  XDJ, XIJ, XSJ.  In the previous week, eight sectors were bullish.  That's a big change in breadth.

Sectors in pull-back mode (Daily RSI falling below Weekly RSI) XXJ, XMJ, XEJ, XTJ, XHJ, XUJ, XPJ and XNJ.  That's eight out of eleven sectors.

Gold (an industry group within XMJ) is in pull-back mode. 

On the daily time-frame, we've switched from eight out of eleven bullish sectors, to eight out of eleven sectors in 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 above the 10-DAY MA but remains well above the 21 and 34 Day Moving Averages.  The Moving Averages are all aligned in bullish fashion from 10DMA at the top, then 21, then 31.  This provides a buffer against pull-backs.

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 13th week in a row and has moved well above its 5-Week MA.   This week there were only 6 Strong Stocks compared to 34 the previous week.  Weak stocks remained at four.   While this remains above its 5-Week MA, long-term investors can remain calm.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 67%, This Week 26%.  

2.  % of stocks above 50-Day Moving Average, Last Week 78%, This Week 61%.  

3.  % of stocks above 200-Day Moving Average, Last Week 76%, This Week 71%.  

All metrics have pulled back, but only the shortest time-frame one is showing bearish tendencies.  At this stage, we are seeing a pull-back and nothing more serious.

Stocks above 200-Day MA have fallen from 76% to 71% but remain above the 5-Week MA.

 

Conclusion.

 

Daily chart of XJO was in a strong uptrend.  That has now reversed to the downside.

STW (ETF for XJO) suggests we could see some consolidation here or some upside in the near term.  

Overall, however, investors' mind-set has now taken a turn for the worse.  Expect more downside before this pull-back is over.

Finspiration Australia. Chart Analysis of Australian and International Stock Markets

 XJO up strongly today +1.41%

The XJO shows a bullish engulfing candle.  That's usually a reliable signal.

The XJO is probably in a short-term upside move, a counter-trend rally.

The Index was very oversold (below 30) and the CCI shows a positive divergence.

So we can expect a few days to the upside.

Today eight sectors were up and three down.  That's a good breadth spread.

Financials (XXJ +2.65%) was one of the better results in the sectors.

That's a great bullish candle on the XXJ today - but it still has a lot of work to do to prove its bullish credentials.

     Weekly Wrap - Week ending 10 June, 2022.

XJO Monthly Chart.

XJO is only ten days into a new month (June).

The monthly chart remains range bound 6930-7539, but now at the lower edge of that range.  XJO finished Friday at 6932

The chart is  is essentially sideways as indicated by the two flat Supertrend lines, one above and one below the monthly candles.  

The MACD Histogram has fallen this week to the down-side, indicating that momentum is to the downside.

Weekly Chart.

XJO This week, XJO has its worst week since April, 2020, down -4.24%.  That broke a three week positive run.

The chart is range bound, in concert with the monthly chart, but clearly at the lower end of the range  

Medium term, the chart remains bearish..  Hull MA13 is blue (bearish); two Supertrend lines are blue (bearish) and the chart is just below the 8-Week EMA (bearish).  RSI and CCI are below their mid-lines (bearish). MACD Histogram is falling - momentum to the downside is increasing.

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

Last week XJO finished at 7239, this week it finished at 6932.  

Daily Chart.

Both Supertrend Lines are bearish, Hull MA13 is bearish; Chart is below the 8-DEMA which is bearish.

On the bright side, there is a double positive divergence on the MACD histogram and the MACD itself.

That has a reasonably reliable leading indicator.  It suggests that the Chart will move up in the coming week.  

ASX is closed on Monday, 13 June for Queen's Birthday celebrations in the southern states.  So our market might escape the catastrophic fall in the U.S. on Friday if the U.S. bounces on Monday.

The ASX this week was knee-capped by a huge fall in Financials, down -9.01% after the Reserve Bank raised interest rates by more than expected +0.5%.

I'm a bit perplexed by the fall in the Financial Sector.  Rising interest rates are supposedly good for Banks as they can increase margins.  So the "big boys" who control the market must be assuming that economic activity will be so poor that will impinge on banks, and, possibly, they are expecting a large number of customers to fail in their loan repayments.

In yesterday's post, I looked at ANZ, one of the four big banks which dominate the Financial Sector.  That examination was hopeful of a rebound in ANZ, which would be reflected in the other three big banks.  So we may have seen the worst of the falls in Financials, at least in the short-term

SP500.

On Friday night, SP500 gapped down at the opening and continued falling to finish down -2.91%.

That move takes the SP500 down into a support zone from which it has bounced several times in the past.  After such a big fall, it is likely that SP500 will bounce again.

Sector Changes - past week.

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

Two sectors up, one flat and eight down. The best was Energy XEJ +4.97%, followed by Utilities XUJ +0.46%.  Energy fell heavily on Friday, down -1.64%.  It's run up might be coming to an end.

Financials (XXJ -9.01%) is the biggest sector in the market and a major drain on the performance of the XJO this week.  Not far behind is Real Estate XPJ -7.67%.  XPJ is an interest rate sensitive sector, so the big fall in XPJ is understandable.  The other sector highly sensitive to interest rate movements is Information Technology -4.81%.

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.

ASX Advance-Decline Line is also bearish, and in sync with NH-NL Cum.

 

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 53%, This Week 17%.

2.  % of stocks above 50-Day Moving Average, Last Week 31%, This Week 18%.

3.  % of stocks above 200-Day Moving Average, Last Week 38%, This Week 29%

This is another indicator of weak breadth.  

Once these instruments fall below 20, that's a contrarian signal that the market might bounce.  Two out of three instruments are below 20.  It would be even stronger if the third one was below 20, but we are looking at a very weak oversold market, so the chance of a bounce is good.

I don't think there's any point in jumping the gun, if we're reaching an inflection point in the market, there'll be plenty of time to hop on a new trend.

Seasonally, we often see a medium term up-trend in stock markets.  I'd wait and see how this pans out.

Conclusion.

1.  Monthly, Weekly and Daily Charts are at the lower end of their ranges.   I could speculate that we'll bounce here, and there is some evidence for such a view, but jumping the gun could be dangerous move.

2.  Breadth is poor, so poor that contrarians will be salivating at the prospect of new buying coming into the market.  Contrarian signs are not always reliable, and sometimes well ahead of what could happen.  

3.  We need to see a move up on the Stochastic Daily chart.

4.  Double positive divergence on MACD and its Histogram point to the possibility of a move to the upside.

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

 9/6/22.  XJO fell heavily again today.

XJO fell today -1.42%.  Financials (XXJ -2.07%) again smashed.

XXJ has now lost all of the big rally from early March to late April.  I'll be looking for a floor under XXJ about these levels.

Best performing sector today was Energy +0.56%.  It was the only sector with a positive result.

Breadth remains poor.

NewHighs-NewLows Line continues to fall steeply.  The Advances-Declines Line confirms the bearish outlook.

I think it is best to stay defensive until we see definite improvement in these instruments.

     Weekly Wrap - Week ending 3 June, 2022.

XJO Monthly Chart.

XJO is only three days into a new month (June).

The monthly chart remains range bound 6970-7630.  

The chart is  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 four months - hugging the zero line.

Weekly Chart.

XJO was positive this week, +0.78%.  This is its third week in a row to the upside.

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

Medium term, the chart remains bearish..  Hull MA13 is blue (bearish); two Supertrend lines are blue (bearish) and the chart is just below the 8-Week EMA (bearish).  RSI and CCI are below their mid-lines (bearish). MACD Histogram is flat - non-trending.

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 7239.  

Daily Chart.

The daily chart is in a three-week up-trend, and has broken upside on the Donchian Channel.

Both Supertrend Lines are bullish, Hull MA13 is bullish; Chart is above the 8-DEMA which is bullish.

All of that looks hunky-dory, except - it all might just be a counter-trend rally.  Looming just above are the 50-DMA, 200-DMA and horizontal resistance, all three lined up together.  

To prove its bullish condition, the chart has to surpass those three resistance levels.  Maybe in the coming week?

(Many successful trading strategies use the 200-DMA as a filter.  Take long entries only if the instrument is above the 200-DMA, take short entries only if the instrument is below the 200-DMA.)

Sector Changes - past week.

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

The Market is relatively well balanced, with five sectors up, two flat and four down.  Resources (Materials XMJ +3.83%. Energy XEJ +3.96%) were largely responsible for the positive ASX return this week.  They remain the two sectors best placed for long trades.

Financials (XXJ -1.3%) is the biggest sector in the market and a major drain on the performance of the XJO this week.

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 52%, This Week 53%.

2.  % of stocks above 50-Day Moving Average, Last Week 30%, This Week 31%.

3.  % of stocks above 200-Day Moving Average, Last Week 37%, This Week 38%

This is another indicator of weak breadth.  Despite the rise in the XJO the %age of stocks above key Moving Averages was relatively flat.

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

We need to see each of these parameters above 50% to feel comfortable about the XJO.

Conclusion.

1.  Monthly, Weekly Charts are non-trending - Daily Chart is in a medium term (15-Day) up-trend.  We need to see all three Charts in sync.

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.

  Weekly Wrap - Week ending 29 April, 2022.

XJO Monthly Chart.

March was a good month for the XJO, up +6.39%.   April has settled back a little, down -0.66% for the month.  Despite that fall, the 8-Month EMA and Hull MA13 remain bullish.  That's a good long-term guide for investors.  It's not without qualification, as I show later in the report.

Weekly Chart.

XJO was negative this week, -0.51%, the second down week in a row.  

The long tail on the weekly candle shows strong buying during the week after an early fall.

It remains above the 8-Week EMA. Supertrend (1.5/7) and  Hull Moving Average remain bullish.  

Daily Chart.

This week was a short four-day week due to Anzac Day.  The previous Friday was very weak and that carried over into Tuesday and Wednesday.  Thursday and Friday rebounded but not enough to cancel out the falls on Tuesday and Wednesday.

Indicators are indecisive with Supertrend (1.5/7) turning bullish, but Hull MA13 remains bearish.  Overhead resistance is at 7472 and then major resistance at 7628.  Given events in America on Friday night (SP500 -3.63%) our market will fall at least 1% on Monday.

Using multiple time-frame analysis, Monthly and Weekly XJO remain bullish.  Daily XJO is indecisive and out of sync with the Monthly and Weekly Charts..  Wait for all time frames to get back in sync before re-entering the market.

XJO and SP500 compared.

The chart above shows the performance of the SP500 (America - blue and grey candles) with the XJO (Australia - yellow and blue candles) over the past 100 trading days.

The two indices were more or less in sync from early December to early February.  They then tended to diverge.  There is still a degree of correlation, but we can see that the Australian market is well ahead of the American market.

The Australian and American stock markets are very different beasts.  The Australian market is dominated by miners and financial services, while the American market is dominated by technology stocks.  Technology stocks tend to be heavily leveraged, so they tend to do less well in environment where interest rates are rising.  Hence the divergence in the two particularly in the past month. 

Sector Changes - past week.

This chart shows the performance of each sector (plus Gold Miners, XJO, BEAR and IAF) over the past week.  XJO was down -0.51%.  Five sectors were up and six down.  Unfortunately, among the six down sectors were the two biggest sectors, Financials (XXJ -0.7%) and Materials (XMJ -1.14%).

As a general rule, look for stocks in the best sectors and avoid stocks in the worst sectors.  For example, look to Utilities (XUJ), Industrials (XNJ) and Property (XPJ) for stocks to buy.  Avoid Information Technology (XIJ), Materials (XMJ).  (Exceptions to that general rule could occur.)  XUJ is now very overbought and probably not a serious contender for current buying - look to buy the dip.

Materials

A major driver of the Australian market has been the Materials Index which can be quite volatile as the above chart shows.  On Tuesday, XMJ hit its oblique support level and rebounded.  A break down through that oblique support level could see a serious decline in XMJ affecting the broad market.

New Highs - New Lows Cumulative.

NH-NL Cumulative is in a consolidation phase and has tipped well under its 10-Day Moving Average, that's a caution sign for long-term investors.  It continues to deteriorate and should be taken seriously by long-term investors.  Look to take a defensive stance in the market.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average, 57%.

2.  % of stocks above 50-Day Moving Average, 65%.

3.  % of stocks above 200-Day Moving Average, 57%.

All three are above 50% level - which confirms the bullish status of the ASX

Bonds versus Stocks.

At the end of the week, Stocks had an advantage over Bonds, but only just.  This is a chart of relativities, not absolutes.  

The relativity has weakened with the chart now below its 10-Day MA.  At this stage, at the end of the week, stocks have a slight relative advantage over bonds.  But the case for stocks over bonds is weakening.

Offence or Defence?

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.  

Consumer Staples are much more resilient to lack of confidence in the economy.  While they may delay purchasing a new refrigerator or Apple computer, consumers will still buy toilet paper and breakfast cereal.  In Australia, big retailers like Woolworths and Coles dominate the Consumer Staples market.

We can see in the above graph, that XDJ and XSJ were more or less in sync until February this year, when XSJ chart began to dominate the XDJ chart.  

That suggests that investors need to take on a more defensive posture than they had last year.

Conclusion.

1.  The monthly, weekly and daily charts are out of sync.  While they remain out of sync, it's best to wait till then are back in sync (all bullish) before committing more money to the market.

2.  XSJ/XDJ suggests a defensive posture in investments.

3.  Negative correlation between the NH-NL Line and the XJO may be predicting further falls in our market.

4.  Price action on the last two days of the week, but a very negative result in the U.S. on Friday night suggests we could see some serious falls coming up in the next few days.

5.  Materials (XMJ) was one of the mainstays in our market for the past few months.  A break lower below its oblique support line could result in major falls in our broad market.

Stay defensive until the market conditions improve.

Finspiration Australia. Weekly Wrap, week ended 8/4/22

          XJO down this week.  

XJO Monthly Chart.

March was a good month for the XJO, up +6.39%.   April has begun with a consolidation period, down just -0.29%.  8-Month EMA and Hull MA13 have both turned bullish.  It's early days in the month of April, so we need more time to see if this bullish bias can hold for the rest of the month.

Weekly Chart.

XJO was negative this week, -0.21%. That's the first negative week after three weeks up in a row. 

The chart, however, is remains bullish.  It has moved above the 8-Week EMA, Supertrend (1.5/7)  Hull Moving Average remain bullish.  Any pull-back is likely to be bought.

Daily Chart.

This week, XJO weakened with the 8-Day EMA, Supertrend (1.5/17) and Hull MA13 all turning short-term bearish.

Using multiple time-frame analysis, Monthly and Weekly XJO remain bullish.  Daily XJO has turned bearish.  Wait for all three to be in sync before adding more money to this market.

Relative Strength of Sectors - past 52 days.

This chart compares the performance of each sector against the performance of the XJO.  Sectors above zero have outperformed the XJO over the past 52 days.  Sectors below zero have underperformed XJO over the past 52 days.

As a general rule, look for stocks in the best sectors and avoid stocks in the worst sectors.  For example, look to Utilities (XUJ), Energy (XEJ) and Materials (XMJ) for stocks to buy.  Avoid Consumer Discretionary (XDJ), Telecommunications (XTJ) and Health (XHJ).  (Exceptions to that general rule could occur.)  

New Highs - New Lows Cumulative.

NH-NL Cumulative this week returned to its 10-Day Moving Average, a break below would send a big caution signal to long-term investors.

Bonds versus Stocks.

At the end of the week, Stocks had a clear advantage over Bonds.  The relativity has weakened a little with the chart now below its 20-Day MA.  The chart is only a little below its recent high, which was the best its been since late November, 2020.  Extremes like this are often contrarian signals.  

Conclusion.

after three weeks of strong gains, the XJO pulled back a little this week, with the daily chart now short-term bearish.  The weekly and daily charts remain positive.  Wait for the three time scales to come back into sync.

Traders should concentrate on the strongest sectors:  Utilities, Materials and Energy.