Finspiration Australia. Apple Inc. leads a big rise in Australian and U.S. stocks.

Apple reported after the U.S. market closed early Friday morning (Oz time), which produced a rise in U.S. Futures.  The Australian market, when it opened on Friday, drew encouragement from the U.S. Futures and finished well up at the close on Friday, XJO +2.19%.  Apple (+6.98%) and Visa (+10.6%) both rose strongly in Friday trading in the U.S. which lead to big jumps in the major U.S. indices, Dow Jones +1.65%, Nasdaq +3.13%.

Bonds in the U.S. were also supportive of stocks with the yield on 10-Year Treasuries falling -1.68% (prices for 10YT rising),

Yesterday in Australia.

XJO has bounced strongly off a major support level.  Yesterday's candle is a bullish engulfing candle - one of the stronger candle-stick signals.  We can expect more upside in the short-term (maybe not on Monday), but the medium-term is somewhat cloudy.  The 50-Day MA has turned down and the 200-Day MA has turned down.  The 50-Day MA is close to completing a "death cross" by falling below the 200-Day MA.  

XJO  is still a long way below the 200-Day MA and we can see a major resistance level at 7189.  XJO finished Friday at 6988.  Then we have the massive old trading range which will also provide resistance.

We'll have to wait and see how this bounce goes - and be ready to sell into any advance.

Overnight.

Dow Jones +1.65%.  SP500 +2.43%.  Nasdaq +3.13%.  Small Caps +1.55%.  Banks +1.03%.

SP500.

SP500 has bounced strongly off major support offered by the Sept/Oct low. 

Friday's action in the U.S. erased the past three days' losses in the SP500.  That takes the Index back up to resistance of the 200-Day MA and the Tenkan Sen (mid-point of the past nine days).  If that can be overcome, triple resistance lies ahead: major horizontal resistance, Kijun Sen (mid-point of the past 26 days) and the lower edge of the Ichimoku Cloud.  Tough stuff.

Commodities.

Commodities Index +0.09%.  Energy +0.36%.  Base Metals -0.9%.  Gold -0.3%.

Fear and Greed.

Despite the correction that has occurred in the SP500 (i.e., more than -10%), the Fear and Greed Index hasn't fallen into the Extreme Fear quadrant which usually precedes substantial rises in the major U.S. indices.  We might have to see Extreme Fear before we can presume we've seen "the" bottom in this market.

Finspiration Australia. Dow flat, Nasdaq down

Overnight:

Dow Jones -0.02%.  SP500 -0.54%.  Nasdaq -1.4%.  Small Caps -1.97%.  Banks -1.2%.

Indices were well up early in the day, faded in the middle session, and stayed low in the afternoon.

SP500.

SP500 continues to hold at major support, but below the 200-Day MA and Ichimoku Cloud.

RSI(14) remains extremely ovcr-sold with a reading of 24.3.  CCI is show a porisitve divergence from price, so a move to the upside seems likely.  Any significant bounce will probably be sold into.

Commodities.

Commodities Index +0.5%.  Energy +1.26%.  Base Metals +0.17%.  Gold -1.29%.

Iron Ore +0.5%.

XJO surged at the opening but has now fallen back a little to be up +0.7% after 30 minutes of trading.

Apple Inc. reported good results after the U.S. market closed and Dow Futures are up 200 points, so that probably explains the positive opening in Australia this morning.  After 40 minutes of trading, XJO is up only +0.2%.  This is looking like a repeat of yesterday.

Finspiration Australia. Wild swings on the XJO today.

XJO finished down today -1.77% after being up more than +0.9% after the opening.  (What were they thinking of?). A rally in the afternoon carved more than 1% of the losses at 1.15 p.m. but that did little to save the XJO from a massive loss today.  

 So, the afternoon session did see some nibbling at the XJO by the bottom feeders.

Advances/Declines were nowhere near as bad as they have been in the past four days.  A/D ratio today was 0.31% - a lot better than Tuesday's ratio of 0.13%, but a long way from the mid-09nt of 0.5.

Today saw extremes which haven't been seen for a long time.  NewHighs-NewLows came in at -115,  We haven't seen triple negative figures for NH-NL since the bear market of 2020.

Rate of Change Difference between Bonds and Stocks is also at levels we haven't seen since the bear market of 2020.

This graph compares the rate of change of stocks compared to bonds.  Bonds are clearly out-distancing stocks in Rate of Change.  That's not a lot of solace as Bonds are also in a down-trend - just nowhere near as severe as stocks.

All of this suggests we're getting close to a low.  But until we see definite signs of a low - it's best to leave the bottom pickers to try to catch falling knives.

So far, the XJO is down more than -11% since its high on 5 January to the low of today.  That's "officially" in correction.

Finspiration Australia. Fickle market falls on Fed announcement.

 Overnight.

European stocks finished higher last night, STOXX600 +1.68%.  Europe closed before the Federal Reserve's announcement.  American stocks were also positive at that time, but fell after the Fed's announcement.

Dow Jones -0.38%.  SP500 -0.15%.  Nasdaq +0.02%.  Small Caps -1.47%.  Banks +0.28%.

SP500.

SP500 remains below the 200-Day Moving Average and below the Ichimoku Cloud.  Traders will likely sell into any upside move.

Commodities.

Commodities Index +0.23%.  Energy +1.17%.  Base Metals flat 0.00%.  Gold -1.82%.

Iron Ore +0.2%.

After 15 minutes of trading this morning, XJO is up +0.8%, defying the down trend in late trading in the U.S.

Finspiration Australia. Waiting on the Fed.

 Overnight.

Dow Jones -0.19%.  SP500 -1.22%.  Nasdaq -2.28%.  Small Caps -1.12%.  Banks +0.49%.

SP500.

It was a wild ride on the market last night with the SP500 printing a wide-range candle with a small body (aka a "rickshaw man").  Although a wide-range candle - still not as wide as the previous session.  The past two days have been exceptional - with high volume and finding support at last year's Sept/Oct low.

The SP500 is extremely oversold with RSI(14) at 25.8.

All of this points to the probability of a move to the upside.  Tuesday's action suggests that major participants are anticipating a move to the upside - no matter which way the Federal Reserve decides to go.

Commodities.

Commodities Index +0.91%.  Base Metals +0.61%.  Energy +1.4%.  Gold +0.32%.

All four charts show a bull flag with a break to the upside last night.  That's a positive for the Australian market.

Australia is closed for a public holiday today.  We'll have to wait till tomorrow to take action on the decision of the Federal Reserve.

Finspiration Australia. Can it get any worse?

 XJO down today -2.49%.

XJO is in a steep down-trend and extremely oversold with RSI(14) at 27.16.  Below 30 - we can expect a relief rally in the next day or two.

Today looked like capitulation to me.  All eleven sectors were down.  NewHighs/NewLows came in at 3.09%.  It can't go below 0.  Advances?Declines came in at 12.5%.  Another very low reading.  In the ASX200 (XJO) we had 9 Advances and 185 Declines.  That's a figure of 4.64% Can it get any worse.  Possibly - but not much.

The Australian VIX (Fear Index) reached a one year high today and finished at 18.54.

In European markets, Germany is currently up a little, about +0.1%.  UK is up +0.22%.

The Federal Reserve is meeting this week.  What they decide may determine the future of the stock market.  If inflation remains their primary focus, we could see more declines in the stock market.  If they hold off given the parlous state of the stock market, we may get a rebound.

Finspiration Australia. Great turnaround last night in America.

 Overnight.

Dow Jones +0.29%.  SP500 +0.28%.  Nasdaq +0.63%.  Small Caps +2.26%.  Banks +0.96%.

MarketWatch, a U.S. market commentary site, described the turnaround as one for the ages, best since 2008.

SP500.

Last night's turn-around was, indeed, extraordinary.  At one stage, SP500 was down over -3%.  It recovered all of that and a bit more.

This is following the script I set out in my Weekly Wrap on Sunday.  This turn-around has come out of nowhere.  What's changed?  The Fed will continue raising rates.  Covid continues to cause concern.  International tensions over Ukraine/Russia and China/Taiwan remain.

At the moment, Bulls are cheering, Bears are gnashing their teeth.  

We'll have to wait and see if my script plays out to the end.  

After 25 minutes of trading, Australia's XJO is down more than -1%.  So our market doesn't believe in the big turn-around