Finspiration Australia. Market Analysis of Australian and Overseas Markets.

 Sat. 15/1/22.  Oz down, U.S. Mixed.

Yesterday in Australia.

XJO was down heavily -1.08%.  The short-term trend is down, but lies in an upsloping channel.  It is currently testing support of the lower supporting line of the channel and the 50-Day Moving Average.  That suggests hat the next move will be to the upside, but, until horizontal resistance at 7471 is broken to the upside, it is best to remain cautious.

Since early September, XJO has basically traded sideways in a broad range with a false break to the upside produced by the Santa Rally.  That's a long time for a sideways trend and frustrating for medium to long-term traders.  This type of cautious markets occurs from time to time, but this has been a particularly long period of sideways action.  See tomorrow's Weekly Wrap for more on this.

Overnight in the U.S.

Dow Jones -0.56%.  SP500 flat +0.08%.  Nasdaq +0.59%.  Small Caps +0.45%.  Banks -0.31%.

Although the U.S. results are mixed, intra-day trading was consistent with strong buying coming into the market in the afternoon session.  That's usually a sign that institutions are buying - and confident that further upside will be seen.

SP500.

The short-term trend is to the down-side, but, like the Oz market, SP500 is in a medium-term up-sloping channel.  It is currently close to the lower supporting line of that channel.  There could be a bit more downside in this but probably not much, with the potential of a double bottom forming.  Next move will probably be to the upside.

The intra-day buying last night can be seen in the current candle, with a long lower wick topped by a yellow body.  That means that the SP500 opened lower, then fell, followed by strong intra-day buying which took the Index well above its opening price.  That's a positive.  We need to see follow-through buying in the next day to confirm.

Commodities.

Commodities Index +1.3%.  Energy +2.05%.  Base Metals -0.22%.  Gold -0.29%.

U.S. Banks.

The U.S. Bank Index has been tearing high (see above $bkx) for the past month.  Three big banks reported last night and would have needed outstanding results to continue the push higher.  The negative divergence on the CCI once again proved to be a leading indicator, and BKX fell last night -0.31%.  

It wasn't all bad news.  Wells Fargo rose +3.7% last might, but JP Morgan fell more than -6% and Citigroup down -1.3%.  Morgan Stanley and Goldman Sachs report next week.

Conclusion.

As indicated above, I'm expecting are market to be up on Monday, but no change in the technical picture.

Finspiration Australia

 Fri. a.m. 14/1/22.  Nasdaq suffers big fall.

Overnight.

Dow Jones -0.49%.  SP500 -1.42%.  Nasdaq -2.51%.  Small Caps +0.01%.  Banks +0.19%.

SP500.

SP500 has retreated from resistance.  The three-day candle-stick pattern (up, doji, down) is bearish in the short-term, but the Index remains above the "cloud" so any pull-back is likely to be short-term.

Commodities.

Commodities Index -1.06%.  Energy -1.14%.  Base Metals -0.22%.  Gold -0.34%.

Iron Ore -2.8%.

Yesterday, all the stars were aligned positively for the XJO.  Today the alignment is negative.

Expect a negative day on our market today - and a retreat from overhead resistance mentioned in last night's report.

Finspiration Australia

 Thu. p.m. 13/1/22.  XJO finished higher today.

XJO was moderately higher today +0.48%, but off the highs which occurred at 1.45 p.m.

XJO has finished at horizontal resistance which stopped advances from October to early December.

The Santa Rally produced a break above resistance, but that proved to be a false break after the big down day on 6 January, when the XJO fell a mammoth -2.74%.

XJO is still struggling to get above horizontal resistance.  Interestingly, today finished its high at 1.45 p.m. which coincided with R1 of today's Pivot Points.

So today we add a double whammy resistance level - long term stretching back to October and intra-day.  That's a powerful combination.  No wonder XJO fell a little in the afternoon trading.

Breadth today was good but not spectacular.  Advances 764 Declines 698.  New Highs clocked in at 47, New Lows 7.

The Cumulative NewHighs-NewLows is an important metric for long-term investors.  

 While Cum NH-NL stays above its 10-Day Moving Average, long-term investors can sleep easy.

Cum NH-NL had a shaky sideways movement in November to early December, but it has shaken off that scare.  Cum NH-NL has kept long-term investors in this market since May 2020, although that shaky period a few weeks ago was a scare - the worst one in over 18 months.

We're still long in the long-term for this market.

 

Finspiration Australia

 Thur. a.m. 13/1/22.  Choppy trading in the U.S. produces modest rises in indices.

Overnight:

Dow Jones +0.11%.  SP500 +0.28%.  Nasdaq +0.23%.  Small Caps -0.46%.  Banks +0.51%.

The negative result in Small Caps suggests that breadth was weak.  

The strong up trend in Banks could end soon as momentum measured by CCI shows a negative divergence.

SP500

With the 50-Day MA (curving blue line) heading upwards, the bias in the SP500 is to the upside.

The PRT bands (yellow) remain bullish.

The choppy nature of last night's trading can be seen in the current doji candlestick.  The small body shows that the Index had little change from opening to closing, while the long upper and lower wicks indicate how trading oscillated above and below the opening price.  Such candlesticks denote indecision.

The U.S. market is entering into reporting season, with some major airlines and banks reporting later in the week.  Delta Airlines on Thursday.  Citigroup, J.P. Morgan Chase and Wells Fargo on Friday.  Those results could be market moving. 

Commodities:

Commodities Index +0.79%.  Energy +1.37%.  Base Metals +0.26%.  Gold +0.26%.

Iron Ore +2.3%.

Overnight results look mildly positive for our market today, but overnight Sydney Futures were down marginally, just 3 points.  So we should have a flat opening today.  Our market was relatively strong yesterday - don't expect much today. 

FINSPIRATION AUSTRALIA

 Wed. a.m. 12/1/22.  U.S. stocks rebound.

Overnight.

Dow Jones +0.51%.  SP500 +0.92%.  Nasdaq +1.41%.  Small Caps +0.67%.  Banks +0.88%.

SP500.

The short-term down trend may have ended.  The short-term line has turned up, but the Index still has short-term resistance of the 8-Day EMA and the Supertrend line to contend with.  Until the short-term line finishes above the 8-Day EMA, this upside reversal remains undecided.

Commodities.

Commodities Index +1.94%.  Energy +2.76%.  Base Metals +1.97%.  Gold +1.21%.

Iron Ore +2.5%

For Australia today, all the stars are aligned with Dow Jones, Banks, Base Metals and Iron Ore all positive.

After 45 minutes of trading, XJO is up more than 1%.

Finspiration Australia

 Tue. p.m. 11/1/22.  XJO falls heavily.

XJO was down today -0.77%.

The short-term trend is down.  The medium-term trend is sideways.  The long-term trend is up.

At this stage, the XJO seems to be finding support at the 50-Day MA, so we could see a bounce here.

Breadth was poor today, with 10 out of 11 sectors falling.  The only positive sector was Materails (XMJ) which only managed a +0.03% rise today.  Not that encouraging.  Declining stocks -834 outpaced Advancing stocks +597.  (My provider of data for Advancing Stocks and Declingin Stocks has had problems posting these results for a couple of weeks, so my A-D Cumulative Line is currently inactive.  It might take a month or so before I get meaningful results for that metric.)

I'm still looking forward to the American results tonight.  A positive result should be bullish.

Finspiration Australia

 Tue. a.m. 11/1/22.  Dow Jones down.  Nasdaq flat.

Overnight.

Dow Jones -0.45%.  SP500 -0.14%.  Nasdaq +0.05%.  Small Caps -0.39%.  Banks -0.22%.

Major indices started well in negative territory after poor results in Europe.  Intra-day buying erased most of those falls.  That suggests that this pull-back could be over.

SP500.

 

The long tail on today's candle is clear in this chart.  It dipped into the "cloud" then rebounded and found support at the Kijun-Sen.  That action is potentially bullish.  We need confirmation in the next trading session.

Commodities.

Commodities Index -0.42%.  Energy -0.5%.  Base Metals -0.89%.  Gold +0.3%.

Negative divergences on CCI for DBC, DBE and DBB show that momentum has slowed and the next move may be to the downside.

Iron Ore down -1.5%.

After 30 minutes of trading, XJO has had a weak start, now down -0.3%.