Finspiration Australia.

2/3/23.  Finspiration Evening Report. 

How Flat is Flat?  

XJO up just +0.05% today after being well up at middday.

For the second day in a row, XJO has finished more or less flat.

Positive sectors were again Energy +1.4% and Materials +2.9%.  All other nine sectors were flat with Financials worst -1.9%.  Financials are close to a level where they will see some buying coming into the sector.

Here's MVB (ETF for the Banks):

RSI is now at 26.95 - that's extremely oversold.

Coles and Woolworths both went ex-dividend today - that pushed the Staples down -1.3%.

In early trading in Europe, STOXX600 is down -0.47%.  Dow Futures flat -0.06%, but SP500 Futures down -0.66%.

Finspiration Australia.

 2/3/23.  Finspiration Tuesday Morning Report.

Overnight in the U.S., Dow Jones flat, SP500 and Nasdaq down.  Commodities strong.

Dow Jones +0.02%.  SP500 -0.47%.  Nasdaq -0.66%.  Small Caps +0.21%.  Banks -0.29%.

Dow Jones shows plenty of intra-day buying to finish flat after being well down during the course of the session

SP500.

SP500 is oscillating around the 50-Day MA but above the 200-Day MA.  Last Friday looks like a "spring" - a precursor to a trend change to the upside, but we still need to see a decisive move to the up-side to confirm.

It remains below the 8-Day EMA and the mid-line of the Bollinger Bands.  We need to see the SP500 in the top half of the Bollies before feeling comfortable.

It's not unusual after a "Golden Cross" for the market to come back and test the important MAs (50 & 200).  At this stage the test seems to have been successful.

Commodities.  Mixed Results.

Commodities Index +1.73%.  Energy +1.64%.  Base Metals +2.92%.  Agriculture +0.64%.  Gold +0.58%.

After 20 minutes of trading this morning XJO is up modestly, +0.17% on the back of stronger Energy and Mining stocks.  The rest of the market is doing poorly.

Bitcoin.

Bitcoin up +1.85% overnight.  The crypto is in a sideways consolidation now in the "neutral" zone and oscillating around the 20-Day MA which is basically flat.

The 50-Day MA has crossed above the 200-Day MA which would complete a "Golden Cross", a bullish event.

Finspiration Australia.

 1/3/23.  Finspiration Wednesday Night Report.

XJO was flat today.

The chart candles show two "inside babies".  Two small candles well within the range of Monday's wide range candle.  That's usually a bullish sign but needs confirmation of a big upside day.

Stochastic (bottom panel) has been in the oversold section below 20 for over three weeks.  That's plenty of time to elapse before a move to the upside.

Despite the flat finish there was plenty of action today.  The market was well down by 11.00 a.m. but then the GDP figures came out - which were disappointing.  Bad news was good news - so the market rebounded - hoping for some easing of interest rate rises.

Energy was up +1.6% today, but that was eclipsed by Materials, up +2.3%.

They were the only two sectors positive today.  Telecoms was worst -2.3%.  Financials didn't fare well, down -1%.

Let's see if we get a good upside move tomorrow.

Finspiration Australia.

1/3/23.  Finspiration Tuesday Morning Report.

Overnight, Mixed results in the U.S.

Dow Jones -0.71%.  SP500 -0.3%.  Nasdaq -0.1%.  Small Caps -0.07%.  Banks +0.3%.

Dow Jones was well down, other indices were indecisive with doji candle-sticks.

SP500.

SP500 is oscillating around the 50-Day MA but above the 200-Day MA.  Last Friday looks like a "spring" - a precursor to a trend change to the upside, but we still need to see a decisive move to the up-side to confirm.

It remains below the 8-Day EMA and the mid-line of the Bollinger Bands.  We need to see the SP500 in the top half of the Bollies before feeling comfortable.

It's not unusual after a "Golden Cross" for the market to come back and test the important MAs (50 & 200).  At this stage the test seems to have been successful.

Commodities.  Mixed Results.

Commodities Index +0.3%.  Energy +0.95%.  Base Metals +1.25%.  Agriculture -0.25%.  Gold +0.46%.

After 90 minutes of trading this morning XJO has rebounded from early lows and is now down about >0.2%. The Mining Index is up about +1%.

Bitcoin.

Bitcoin down about -1% overnight.  The crypto is in a sideways consolidation now in the "neutral" zone and oscillating around the 20-Day MA which is basically flat.

The 50-Day MA has crossed above the 200-Day MA which would complete a "Golden Cross", a bullish event.

Finspiration Australia.

 28/2/23.  Finspiration Tuesday Morning Report.

Overnight, U.S. fades from early highs..

Dow Jones +0.22%.  SP500 +0.31%.  Nasdaq +0.63%.  Small Caps +0.2%.  Banks +0.23%.

Lots of doji candle-sticks, lots of intra-day selling last night, lots of indecision.

SP500.

The past two days have seen the SP500 claw back above the 50-Day and 200-Day MAs.  That's a positive.

It remains below the 8-Day EMA and the mid-line of the Bollinger Bands.  We need to see the SP500 in the top half of the Bollies before feeling comfortable.

It's not unusual after a "Golden Cross" for the market to come back and test the important MAs.  At this stage the test seems to have been successful.

Commodities.  Mixed Results.

Commodities Index +0.08%.  Energy -0.33%.  Base Metals +1.01%.  Agriculture -0.1%.  Gold +0.39%.

After an hour of trading, XJO is up +0.65%.

Bitcoin.

Bitcoin up +1.19% overnight.  The crypto is in a sideways consolidation now oscillating around the 20-Day MA which is basically flat.

The 50-Day MA is about to cross above the 200-Day MA which would complete a "Golden Cross", a bullish event.

Finspiration Australia.

27/2/23.  Finspiration Monday Evening Report.

XJO fell heavily today, -1.12%, following the big fall in New York on Friday.

XJO fell below the important 50-Day Ma today.

It remains below the 8-Day EMA.  It first fell below that EMA on 9 February.   I'd stay away until we see at least a break to the upside of the 8-DEMA.

The index is still not down to my preferred support zone - but anything can happen now.  

The Index is oversold with an RSI at 35.22.  CCI is showing a positive divergence - but that doesn't mean much until we see a good upside break.

Energy (XEJ) was the best performer today, +0.3%.  Financials (XXJ) finished flat despite the big fall today.  The killer today was, again, Materials (XMJ), down -3.1%.  With XXJ showing resilience, this market will only need an upside movement from XMJ to start flying to the upside.

European markets are currently up strongly.  German DAX up +1.16%, French CAC +1.11%.

American SP500 Futures are currently up +0.43% - following the Europeans to the upside.

At this stage, it is looking good for Australia tomorrow.

 

Finspiration Australia.

     26/2/23.  Weekend Report - The Week That Was.  Week Ended 24/2/23.

XJO Monthly Chart.

After almost four weeks, XJO down so far -2.27% after stalling at the top of the strong January candle.  XJO has also reached a zone where it has failed in the past.

So far, the Index is above the 8-MEMA, Hull MA13, 50-MMA, 200MMA, Supertrend (7/1.5).  Not much damage done yet.

  

Monthly RSI is at 54.68.  50 represents the dividing line between bullish and bearish.

XJO Weekly Chart.

                                            

XJO remains in an up-trend, with higher highs and higher lows.  In the past five days, XJO fallen -0.54%.

XJO began to fall three weeks ago at a major resistance level.  

8-Week EMA and Hull MA13 turned turned down, which is bearish. Supertrend is providing support at this moment.  Events overnight in America could see a break to the downside of Supertrend.

Weekly RSI is at 55.2 - bullish but falling.  

CCI remains above its zero line (but falling).  It's been above its zero line since 24 Oct. 2022.  That marked the start of this bull market.

XJO Daily Chart.

XJO was in a strong up-trend in January.  It is currently in a short-term down-trend.

Daily RSI has fallen below its mid-line of 50.  That's bearish

XJO may be finding support at the 50-Day MA.   As stated previously, events on Friday in America could see a decisive break below that support level.

Weekly Changes in Sectors.

Despite the fall in the XJO this week of -0.54%, breadth was quite healthy.  Only two sectors fell this week, XMJ (Materials) -2.96% and XDJ (Discretionary) -1.23%.  XSJ (Staples) was flat, +0.09%

A couple of sectors showed quite healthy gains, XUJ (Utilities) +6.05% and XPJ (Property) also +6.05%.

The damage to the XJO was mainly done by XMJ (Materials) after both BHP and RIO presented gloomy reports to the market.  That's largely a result of events in China, where the country was in lock-down for the second half of 2022 - the time covered by the reports from BHP and Rio.  (The biggest markets for those two countries are in China.)

Monthly, Weekly and Daily RSIs. - Sectors + XJO + Gold + Composite Bonds.

This week's chart:

Each sector has three bars representing the RSI on Monthly, Weekly and Daily bases.

The following is a rough guide to interpreting the chart.

Bullish:  Rising bars.

Bearish:  Falling bars.

Counter trend rally:  Falling then rising.

Pull-back:  Rising then falling.

Bullish Sectors: XIJ, XNJ.

Bearish Sectors:  XXJ, XMJ, XEJ.

Counter trend Rally:  XUJ, XPJ.

Pull-back:  XDJ, XTJ, XHJ, XSJ.

XJO is in pull-back mode.  Composite Bonds (IAF) and Gold (XGD) are also in pull-back mode.

NewHighs-NewLows.

This is a long-term indicator, but a good guide for long-term investors.

NH-NL have been pulling back since the end of January.  That's a warning sign to long-term investors to stay defensive,

Stocks v Bonds.  Relative performance.

On a relative basis, Bonds are currently outperforming Stocks, i.e., the chart is below the zero level.

This is a reasonable picture of bullish and bearish status of the market.  It's probably a good idea to remain bearish on stocks while this chart remains below zero.

% of Stocks above key moving averages.

1.  % of stocks above 10-Day Moving Average: Last Week 42%, This Week 44%.  

2.  % of stocks above 50-Day Moving Average, Last Week 61%, This Week 56%.  

3.  % of stocks above 200-Day Moving Average, Last Week 70%, This Week 65%.

In the short-term, breadth, as measured by stocks above the 10-Day MA, improved a little this week as indicated by the Sector changes shown above.

The longer term measures remain above the 50% mark.  So the market is not in bad shape.

SP500.

I mentioned early in this report, the poor results in America on Friday.  Here's the SP500 chart.

SP500 began a steep decline six days ago and has fallen five of the past six days.  Friday saw a fall of >1%.  That could result in a follow-on fall in the XJO on Monday.

But a lot of strange things are happening in this chart.  Three of the candles show "hang-man" candles.  A small body at the top of the candle and a very long lower wick.  That indicates plenty of intra-day buying.

Although the bears have been dominant in the past six days, bulls have been fighting good rear-guard actions on three of the days, pushing back against the bulls.

The chart is now down to a crucial level.  It bounced strongly off the 200-Day MA on Friday despite the initial big fall.  Such action could spell the end of this push down by the bears.  We need to see a big upside candle on the SP500 on Monday to be confident that this fall is over - at least in the short-term.

It would be very interesting on Monday if the XJO pre-empts the SP500 by rising, or at least showing good strength in intra-day trading

 

Conclusion.

 

February has been a poor month for the XJO.  Although the past week showed a net loss for the XJO, internal strength wasn't nearly as pessimistic as suggested by the -0.54% fall in the XJO.

The long-term trend for the XJO is still bullish with higher highs and higher lows. 

Markets here and in the U.S. are now at a crucial stage.  Watch carefully for events on Monday.