Finspiration Australia

 Thu. p.m. 6/1/22.  Ozzie stocks dumped.

XJO down heavily today -2.74%.

We rarely see falls as big as this on the Australian stock market.  Today's fall is the largest seen in at least the past 200 days.  Something significant has occurred in the minds of our masters who control our market.

Having said that, we will, no doubt, be up tomorrow.  But don't expect any miracles.  A chance to sell out?  Probably.

No sector was immune today.  The best performing sector, relatively, was Materials (XMJ) -1.45%.  It held up because of the rise in iron ore prices overnight.  BHP +0.12%.  RIO +0.73%.  But FMG fell -1.05%

Finspiration Australia

 Thu, a.m. 6/1/22.  End of the Santa Rally.

Overnight:

Dow Jones -1.07%.  SP500 -1.94%.  Nasdaq -3.34%.  Small Caps -2.47%.  Banks -1.08%.

SP500.

SP500 is back to a major support level so we may see some consolidation here.   

Commodities.

Commodities Index -0.43%.  Energy -0.23%.  Base Metals 0.00%.  Gold -0.3%.

Iron Ore +2%.

After 30 minutes of trading this morning, XJO is down -0.9%.

Finspiration Australia.

 Wed. p.m. 5/1/22.  XJO falls modestly after Tuesday big rise.

XJO down -0.32%.

I'm no Elliott Wave Specialist, but a cursory glance at the pattern from 2 December suggests we're looking at a classic five wave impulse patter:  1 - Up, 2 - down, 3 - up, 4 - down, 5 up.  That's usually followed by a three wave corrective pattern.

Here's an idealised chart:

Maybe this all just technical analysis witch-doctors.  If it has any validity - then we might be in for a pull-back.

Statistically, the Santa Rally continues until the second trading day in January.  So we could be close to the end.

For a long time, I've pencilled in 6 January as a possible start of a pull-back for the market - just based on previous experience.

Let's continue to watch the charts and see how this pans out.

Finspiration Australia

 Wed. a.m. 5/1/22.  Mixed results in U.S.

Dow - new record.  SP500 flat.  Nasdaq down.  Banks Whooshka.  Bond yields higher.

Dow Jones +0.59%.  SP500 -0.06%.  Nasdaq -1.33%.  Small Caps +0.65%.  Banks 3.39%.

US 20Yr Treasuries Yield +5.67%.  That's what sank the Nasdaq which is sensitive to interest rates - and gave the Banks such a boost.

SP500.

SP500 is in a short-term sideways consolidation.  The medium-term trend remains up.

Hull 13MA has turned down which suggests the next move will be to the downside.  Plenty of support remains on the downside, so this may be a buy the dip scenario.

Commodities.

Commodities Index +1.2%.  Energy +1.09%.  Base Metals +1.36%.  Gold +0.74%. 

Iron Ore +2.8%.

Overnight Oz Futures -0.3%.

Expect a weak opening after yesterday's huge rise in the XJO.

 Tue. p.m. 4/1/22.  XJO - Whooshka.

XJO was up today an extraordinary +2%, so it definitely deserves a "Whoosha" label.  We rarely see +2% rises on the XJO, but it happened today on the first day of trading 2022.

 Clearly, today was an extraordinary event, helped by low volumes, it is easy to push the index around.

Technically, I've marked in grey a major support zone, so it wasn't unpredictable that we would see an up move today, but the sheer scale of the up move is extra-ordinary. 

Expect some downside tomorrow.

 Tue. a.m. 4/1/22.  New closing high for the Dow.

Overnight.

Dow Jones +0.68%.  SP500 +0.64%.  Nasdaq +1.2%.  Small Caps +1.08%.  Banks +2.62%.

SP500.

The trend remains up.  Stay with the trend.

Statistically, the Santa Rally has one more day to run.  Keep watching the charts for a reversal.

Commodities.

Commodities Index +0.38%.  Energy +1.64%.  Base Metals -0.81%.  Gold -1.54%.

Iron Ore +0.4%.

After 20 minutes of trading, XJO is up +0.8%.

 Yearly wrap-up.  Year ended 31/12/21.

It's that time when we look in the rear-view mirror and see how the Ozzie market did in 2021.  Not too bad actually, not fantastic, but good enough to make most investors happy.

The above chart shows the yearly performance of the XJO over the past 21 years.  In those 21 years, 2021 was the eighth best yearly performance.  That puts it in the top half of performances.  

XJO up in 2021 by +13.02%.  The average yearly gain in the past 21 years a little over +5%.  That figure, of course, has been skewed by the big drop in 2008 when the XJO was down more than -40%.

The median figure for the XJO for the past 21 years is 7.9%.

Dividends for the XJO in 2021 were +3.78%.  So, total return in 2021 was 16.8%.

The XJO Index was launched in the year 2000.  Before then, the Australian All Ordinaries was the benchmark for investments in Australia.  Since 1900, the average total return for the Australian market has been 11.8%.

So - if an investor had put their money into the XJO at the beginning of 2021, they would be feeling good about their investment.  

Historical returns since 1900:

For more market statistics go here:

What does it all mean for 2022?  Nothing at all.  2022 could do anything.

Keep an eye on the monthly chart of the XJO if you want to take defensive action as a result of a down turn:

Supertrend 1.5/7 and 8-Monthly Exponential Moving Average usually provide timely warnings for exits and entrances.  They won't give you tops and bottoms - but they do provide a good safety net.

All the best for 2022.