Finspiration Australia. Chart Analysis of Australian and International Stock Marke

   Weekly Wrap - Week ending 20 May, 2022.

XJO Monthly Chart.

After three weeks of May, the monthly chart is range bound 6970-7630.  

The chart is currently below the 8-month EMA but it is essentially sideways.  

We need about another week of data to see how the Monthly chart is travelling

Weekly Chart.

XJO was positive this week, +1%, breaking four weeks in a row to the downside.

The chart is range bound, in concert with the monthly chart.  Medium term, the chart the chart remains bearish..  Hull MA13 is blue (bearish); Supertrend (1.5/7) is blue (bearish) and the chart is below the 8-Week EMA is heading down (bearish).  RSI and CCI are below their mid-lines (bearish) and Stochastic has fallen below its signal line (bearish).

The chart is, however, at the lower end of the range so we'll probably see a move to the upside in the coming week.

The chart shows a trading range in round figures from 7630 to 6930.  This week XJO finished at 7075.  

Daily Chart.

In the short-term, this chart is looking positive.  Indicators in the lower panels have turned up; Hull MA13 and Supertrend (1.5/7) in the top chart are also bullish.

The chart has now formed a higher low, that's half-way to concluding a new up-trend.  We still need to see a higher high to complete the criteria for an up-trend.

The daily chart is, thus, out of sync with the weekly chart - that's typical in a range-bound market.

Sector Changes - past week.

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

Pluses and minuses for sectors were evenly spread with six sectors up and five sectors down.  Materials (XMJ +3.65%) had a return to form as did Information Technology (XIJ +5.04%).  

Consumer Staples (XSJ -3.45%) was the worst after a poor report from Woolworths (WOW -6.08%) and a big fall in URW -7.87% after a big sale of stock under market value.

New Highs - New Lows Cumulative.

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.

Like NH-NL Cum, ASX Advance-Decline Line is also bearish, but not as bleak as NH-NL Cum.

It is nudging on its 5-Week Moving Average and another good week would take it over that metric.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 20%, This Week 74%.

2.  % of stocks above 50-Day Moving Average, Last Week 36%, This Week 38%.

3.  % of stocks above 200-Day Moving Average, Last Week 33%, This Week 40%

Two out of three are below 50% level - which confirms the bearish status of the ASX.  This week's bounce has resulted in a bounce in the shortest term metric.  That could be the start of a medium-term trend reversal.

Last week I noted:   This is the second week in a row where %Stocks above 10-DMA has been 20% or below.  That's another contrarian signal for a short-term bounce.  We got that bounce this week.

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.  

Conclusion.

1.  Weekly and daily charts out of sync - typical of a range-bound market.  Traders will play the ranges.

2..  Short to medium term is looking good for further upside.  We've probably seen a bottom in the medium-term.

I gave three beaten down stocks as tips last week ALL, REH, JHX.  

     ALL:  Buy at or above 33.06.  Stop Loss at 31.64.

     REH:  Buy at or above 16.00.  Stop Loss at 15.02.

     JHX:  Buy at or above 40.64.  Stop Loss at 39.06

ALL triggered a buy on Thursday when it hit 33.06.  It finished Friday at 35.17.  That's a gain of +6.4% so far.  Move stop up to break even at 33.06.  Continue to move the stop up if ALL continues rising.

REH triggered a buy stop on Monday at 16.00, but continued to fall the rest of the week.  Stop Loss still not triggered.  REH is currently sitting on a loss of -3.4%.

JHX didn't trigger a buy stop.  No trade.  Forget about JHX,

From the two trades, we're sitting on a gain of +3%.

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

21/5/22.  Yesterday In Australia. 

Strong day on the XJO yesterday, up +1.15%.  XJO has now formed a higher low.  We still need to see a higher high to meet the definition of an up-trend.

Tenkan Sen (Conversion Line - Blue) is now acting as support for the XJO.

Overnight.

Dow Jones +0.3%.  SP500 +0.01%.  Nasdaq -0.3%.  Small Caps -0.37%.  Banks -0.06%.

Flat finish in the U.S. after intra-day buying erased most of the early buying and producing "hanging man" candlesticks on all of the above indices.  That often occurs at or near the end of down-trends.

SP500.

SP500 continues to sketch out a possible bottom for this down-trend.  Positive Divergence on CCI gives further optimism to that view.

Any rally is likely to be a counter-trend rally until proven otherwise.

Commodities.

Commodities Index +0.14%.  Energy +0.62%.  Base Metals +0.31%.  Agriculture -0.67%.  Gold flat +0.07%.

NY Advance-Decline Line.

NY A-D Line remains in a down-trend.  Stay defensive until we see this change to an up-trend.

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

20/5/22.  Overnight.

 Dow Jones -0.75%.  SP500 -0.58%.  Nasdaq -0.26%.  Small Caps -0.49%.  Banks -0.45%.

SP500.

SP500's candle last night was a doji spinning candle, so it could be sketching out a double bottom.  It still has a lot of work to do to confirm that, but it does look promising.

Commodities.

Commodities Index+1.27%.  Energy +1.13%.  Base Metals +3.54%.  Agriculture -0.04%.  Gold +1.47%.

Iron Ore +0.9%.  Thermal Coal flat 0.0%.

After 20 minutes of trading this morning, XJO is up 0.6%.  So it looks like a strong day today going against the trend set by America last night.

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

 19/5/22.  After big falls in the U.S. last night, Oz market down heavily today, -1.65%.

The short-term trend is undecided, with two Supertrend Lines positive and one negative.

Hull MA13 remains positive.

The past few days have seen a drop off in Volume.

This suggests that the retail traders are largely finished their selling and sitting out of the market - or just holding on.  The market is now largely the play-thing of the big institutions, so, if we see a rebound, it should be significant.

Until we see an improvement in breadth, stay defensive.  (See charts below.)

Finspiration Australia. Chart Analysis for Australian and International Stock Markets

Welcome to new reader from Russia.

19/5/22.  It was ugly on Wall Street last night. 

U.S. Indices.

Dow Jones -3.57%.  SP500 -4.04%.  Nasdaq -4.73%.  Small Caps -3.19%.  Banks -2.89%.

SP500.

Two Blue Supertrend lines and one Yellow.  (Two bears and one bull.). Until we see all yellow it's best to stay defensive.

Commodities.

No joy for traders in Commodities last night.

Commodities Index -2.16%.  Energy -2.19%.  Base Metals -2.04%.  Agriculture -2.44%.  Gold +0.05%.

Iron Ore -1.3%.  Thermal Coal -0.4%.

Overnight Oz Futures -1.9%.

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

 18/5/22.  XJO up strongly today.

XJO up today +0.99%.  We now have four days to the upside.  XJO is now coming up to the last of three Super-trend lines.  That might provide some resistance.

In a return to form, Materials (XMJ +2.5%) was the top performing Sector.  Consumer Staples (XSJ -1%) was the worst performer and the only Sector to record negative figures.

Here's the XMJ Chart:

The correlation of XMJ and XJO is clear in this chart.  XMJ has risen above two Super-trend lines and approaching the third one.  That might cause a consolidation or pull-back.

I've calculated a turn-date of 26 May.  So we can expect more upside in the medium term, but not before we see some consolidation and then a move to the upside.

Below is a different type of chart suggesting that the current move is a counter-trend rally:

This chart shows the Ichimoku indicators.  

XJO has only just moved into the Ichimoku Cloud - that's a neutral or no-trade zone.

We need to see XJO get above the Ichimoku Cloud before being confident of a bullish medium-term trend. 

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

18/5/22.   Overnight.

Dow Jones +1.34%.  SP500 +2.02%.  Nasdaq +2.76%.  Small Caps +3.02%.  Banks +3.9%.

Euro Stoxx50 up +1.52%.

Despite the current rally, all of the above remain in a down-trend.  An up-trend can be declared when we see a higher high and a higher low.

SP500.

Two out of three Super-trend Lines have now switched to yellow (bullish).  Hull MA13 has switched to yellow (bullish).

Divergences on CCI are a leading indicator for a short-term trend change.  See Above.

Commodities.

Commodities Index -1.09%.  Energy -2.09%.  Base Metals +1.26%.  Agriculture +0.53%.  Gold -0.63%.

Iron Ore -0.7%.  Thermal Coal +2.8%.

Overnight Oz Futures +0.9%.

Overnight in the U.S., BHP up +3.25%, RIO +3.59%, Woodside +1.99%.