Finspiration Australia. U.S. down overnight. Dow in correction territory. 8/3/22

 Overnight.

Dow Jones -2.37%.  SP500 -2.95%.  Nasdaq -3.62%.  Small Caps -2.29%.  Banks -4.62%

SP500.

SP500 down almost -3% - biggest down day for a long time

Positive divergences beginning to show up on RSI and CCI.  The American market could be close to a bottom.

Commodities.

 Commodities Index +2.18%.  Energy +2.95%.  Base Metals -1%.  Gold +1.49%.

Iron Ore +6.8%.  

XJO is performing relatively well this morning.  At 11.40 a.m ((AEST) the XJO is down just -0.12%.  Despite the big jump in iron ore, the two big iron ore miners are down, BHP -1.91% and Rio -2.53%.  The "Smart Money" must have smelt something in the air this morning to produce those falls.

Finspiration Australia. Weekly Wrap - week ended 4/3/22.

      XJO was up this week - not enough to be long-term bullish.

XJO Monthly Chart.

XJO has been in a down-trend since September, 2021.  

In January, the monthly chart gave a long-term sell signal for both the Supertrend (1.5/7) and the 8-Month EMA.  January was brutal for the XJO.  A long standing adage of stock market pundits is:  As goes January, so goes the year.

Now, after the first week of March, the March candle remains below the 8-Month EMA and below the Supertrend.   

I'd like to see the Hull Moving Average turn positive (blue dashes change to yellow dashes) before taking buy action.  For long-term investors - stay defensive.

Weekly Chart.

XJO was positive this week, +1.61%.   It remains below the 8-Week EMA, the 50-Week MA and Supertrend (1.5,7).  The Hull Moving Average remains negative (blue dashes).  

Stay defensive.

Daily Chart.

XJO had a good week this week.  Up four days in a row, but it ran out of puff on Friday.  Friday was not all negative, as strong intra-day buying restricted losses to -0.57%.  Resources had a particularly good week with Materials +8.14% and Energy +8.85%.  But that means the XJO was in an unbalanced state.  Unbalanced markets are easy to knock to the down-side.  That's unlikely to happen on Monday as Energy and Base Metals were both very strong on Friday night.  While the war in Ukraine remains unresolved, we can expect resources to continue doing well.  That might be enough to sustain our market from severe downside pressure and may result in gains.   

The short-term trend remains bullish but up against strong resistance.  Stay defensive - but stock picking might pay off.

Sector changes this week.

Only four sectors were up this week, and one of those (XNJ +0.13%) was essentially flat.  The outsized gains in Energy (XEJ) and Materials (XMJ) are clear in the above chart.

The worst three performers were Consumer Staples (XSJ) --1.64%), Financials (XXJ) -1.52%, and Property (XPJ) -1.77%.  

New Highs - New Lows Cumulative.

NH-NL Cumulative this week remains clearly below its 10-Day Moving Average.  Until we see a decisive move back above the 10-Day MA, it is best to stay defensive.  This is a good indicator for long-term investors.

Weakness in the NH-NL Cum is confirmed by my weekly Strong-Weak Stocks Cumulative chart.  It remains below its 5-Week Moving Average.

S-W Cum tends to act a little earlier than NH-NL Cum, but NH-NL Cum has an advantage in being compiled on daily data rather than weekly data.

Advances-Declines Cumulative.

The dashed line in the above chart is the 20-Day Moving Average.  It shows a distinct down-trend.  Until this down-trend ends, stay defensive.

Bonds versus Stocks.

Despite the positive week in stocks, the Stocks/Bonds Ratio chart shows a small advantage for bonds over stocks at the end of this week.  But there's not much in it.  The chart finished just below zero (bonds doing better than stocks).  That sends a clear message to stay defensive.

Stocks above key moving averages - last week and this week.

A look at the number of stocks in the ASX100 above key moving averages provides an idea of how bad thins are.

ASX100 stocks above 10-Day MA:  Last week 28%.  This week 38%.

ASX100 stocks above 50-Day MA: Last week 32%.  This week 37%.

ASX100 stocks above the 200-Day MA: Last week 38%.  This week 37%.

Until we see all of these above 50%, it's best to assume we are in bearish conditions.

Conclusion.

Despite the solid gains this week, the Australian market looks weak.  Measures of breadth are all indicating weakness in the broad market, it was only strength mainly in Energy and Mining that resulted in a positive week this week.  While the Ukraine war continues, Energy and Mining are likely to sustain our market, or, at least, prevent severe losses.

While internal measures of breadth remain weak, stay defensive.  

Good luck and good investing.

Finspiration Australia. U.S. stocks down, safe havens up. Sat. 5/4/22

 Yesterday in Australia.

Yesterday, XJO was down -0.57%.

Overnight.

Dow Jones -0.53%.  SP500 -0.79%.  Nasdaq -1.66%.  Small Caps -1.36%.  Banks -3.41%.

Huge falls overnight in Europe with the STOXX600 down -3.56%.

SP500.

Short-term, SP500 remains in non-trending, consolidation mode.  Longer term, SP500 remains bearish.  Wait.

Commodities.

Commodities Index +4.21%.  Energy +6.73%.  Base Metals +2.2%.  Gold +1.5%.

The current exponential rise in Energy and Base Metals is unsustainable.  Where it will end is unknown, but it will end badly.

Safe Havens:  Bonds and Gold.

20-Year Treasuries (TLT) up strongly +1.73%, but it appears to be in a short-term counter-trend rally.  Overall it appears to be bearish - probably because of the threat of the Federal Reserve raising interest rates.

Gold  is in a strong up-trend +1.59%, and shows no signs yet of reversing to the downside.

While the Ukraine situation dictates uncertainty in the markets, Bonds and Gold will probably continue higher.

NY Advances-Declines Cumulative.

New York NH-NL Cumulative peaked in early November.  The negative divergence from the SP500 Nov.-Jan. predicted the decline in the New York market.  Until this indicator returns to an up-trend, it's best to stay defensive.

Finspiration Australia. U.S. stocks fall as Technology tumbles.

 Overnight.

Dow Jones -0.29%.  SP500 -0.53%.  Nasdaq -1.56%.  Small Caps -0.71%.  Banks -0.85%.

SP500.

SP500 was down moderately, it remains within its short-term consolidation zone.  Next move might be to the upside where strong resistance remains.  Wait.

Commodities.

Commodities Index +1.09%.  Energy -0.79%.  Base Metals +3.33%.  Gold +0.6%.

After 15 minutes of trading this morning, XJO down about -0.5%.

Expect this to be a selling day.

 

Finspiration Australia. ASX follows U.S. to the up side. 3/3/22.

 XJO up today +0.49%.

XJO has now been up five days in a row.  That's getting a little long in the tooth for a short-term rally.

The index is now approaching the resistance of the recent consolidation zone and the Ichimoku Cloud.

It is also hard up against the Supertrend (7,1.5). XJO tried today to rise above that level but failed.

With all that resistance overhead, the probabilities lie to the downside.

The ASX remains unbalanced.  Today, four sectors out of eleven were up.  The biggest movers were again Energy +2.6% and Materials +2.6%.  Such unbalanced markets can easily be tipped into negative territory.

Finspiration Australia. U.S. Stocks rally. 3/3/22.

 Overnight.

Dow Jones +1.79%.  SP500 +1.86%.  Nasdaq +1.62%.  Small Caps +2.73%.  Banks +3.61%.

SP500.

SP500 is in a short-term sideways consolidation.  Probably the next move will be to the upside, but that will take the index into heavy overhead resistance.

Commodities.

Commodities Index +3.26%.  Energy +5.28%.  Base Metals +2.65%.  Gold -1.04%.

Iron ore +0.4%.

The ASX rose strongly at the start of trade with the XJO up about +1% but is now settling back to be up +0.63%.  We should still have solid gains today. 

Finspiration Australia. XJO in a choppy session but up modestly. 2/3/22

XJO up today +0.28%.

 Although XJO finished up today, the candle is an "inside day", which means that today's intra-day high was below yesterday's intra-day high.

Plenty of overhead resistance remains, which means the path of least resistance is to the down-side.

Today's market was unbalanced.  Energy +4.88%.  Materials +3%.  They were the big winners today.  Only two other sectors were up.  Utilities (dragged up by Energy) +0.84%, and Information Technology +0.02% - basically flat.

Financials took a big hit, -1.44%.

The unbalance in the market was felt in breadth.

NewHighs-NewLows -18.  UpStocks-DownStocks -158.

Unless the market is supported by breadth, it is in danger of falling.

NH-NL Cum Chart:

While NH-NL Cum remains below its 10-Day MA, I'll remain bearish.