12/3/23.  Weekend Report - The Week That Was.  Week Ended 10/3/23.

XJO Monthly Chart.

We've had nearly two weeks of trading in March for the XJO, currently down -1.57%.  

So far, the Index is above 50-MMA, 200MMA, Supertrend (7/1.5).  It is sitting on the 8-Month EMA.  A monthly close below that would be bearish.

  

Monthly RSI is at 51/25.  50 represents a dividing line between bullish and bearish.

XJO Weekly Chart.

                                            

XJO remains in a long-term up-trend, with higher highs and higher lows, but the medium term has turned bearish with the chart falling below the 8-Week EMA and Supertrend.  Hull MA13 has turned down - a bearish signal and Weekly RSI has fallen below 50 - bearish.

In the past five days, XJO fallen -1.91%.  

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

In very big round numbers, major weekly support is around 7000.  XJO finished at 7145.

XJO Daily Chart.

The shaded horizontal rectangle represents my preferred support zone for the XJO.  It is now down to that level.  No guarantees - the market can do whatever it wants to do.  If that zone fails, then the next important support level is the 200 Day MA, at 7010 - close enough to my big round number of 7000.

Last week, in my report, I stated:  This looks like the start of a good short-term upside rally.  Well, it turned into a very short short-term rally - up on Monday and Tuesday.  Then, on Tuesday night J. Powell took away the punch-blow with talk about raising interest rates for longer,  Wednesday saw the XJO fall -0.77%.  Thursday night in the U.S. news came out that a medium sized regional bank was failing, and the XJO fell on Friday, -2.28%.  Usually after such a big drop we get some sort of a pause, even an upside move, but the XJO has a lot of work to do to get back to short-term bullish.

Weekly Changes in Sectors.

The two worst performing Sectors were Materials -5.71% and Energy -6.13%.  Those two Sectors were impacted by very large companies (BHP, RIO and WDS) going ex-dividend.  But that doesn't explain all of the poor results in XMJ and XEJ.

Financials (XXJ) didn't help the bullish case by being down -0.83%.

So both of the two largest Sectors 9XMJ and XXJ). making up about half of the XJO. were down significantly.

Six out of eleven sectors were up, with Defensives figuring prominently in that group (XTJ, XSJ, XUJ).

Below is a Weekly Chart for XMJ (Materials).

Solid support lies in the zone 17400-17500.  XMJ finished the week at 17731.  So support is not far away.

NewHighs-NewLows.

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

With two bullish days on Monday and Tuesday, the 3-DMA of NH-NL pushed back above the 20-DMA.  But the latter part of the week saw the 3-Day MA fall again below the 20DMA.  That's a sign for long-term investors to remain defensive.  

Stocks v Bonds.  Relative performance.

On a relative basis, Bonds are currently outperforming Stocks, i.e., the chart is below the zero level.  The chart is now below the level last seen in early Jan. this year. 

This is a reasonable picture of bullish and bearish status of the market.  It's probably a good idea for medium term investors 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 40%, This Week 25%.  

2.  % of stocks above 50-Day Moving Average, Last Week 55%, This Week 47%.  

3.  % of stocks above 200-Day Moving Average, Last Week 61%, This Week 56%.

Last time Stocks > 10DMA were below 20% (currently 25%) was in September last year, which marked the start of a bullish rally.  So we may not be far off a "bottom".

 

Conclusion.

 

The failure of a medium-sized bank in the U.S. is the first since the GFC in 2008.  This event now becomes a "black swan" - an unpredictable event of serious consequences.

There is no way of knowing the severity of such an event.  It's probably best to wait a few days and see how this pans out.

I think we're not far off a "bottom" - but the market doesn't care what I think - watch what happens in the charts.

Finspiration Australia.

 11/3/23.  Finspiration Saturday Morning Report.

From CBS:  California regulators on Friday abruptly shuttered Silicon Valley Bank, closing a 40-year-old financial institution that catered to the tech industry and that was the 16th largest U.S. bank before its sudden collapse. The company's stock tumbled 60% on Thursday and had plunged another 70% on Friday before trading of its shares was halted.   Read more here.

Yesterday in Australia:

Finally, and it gives me no joy to say this, XJO is down to my preferred support zone which I had touted previously for some time.

XJO could fall a little further before a snap-back rally might occur.

XJO down very heavily on Friday -2.28%.

Overnight in the U.S.

Dow Jones -1.07%.  SP500 -1.45%.  Nasdaq -1.76%.  Small Caps -2.5%.  Banks -3.91%.

Last night's candle on the Bank Index finished in the middle of its wide range - but suggests that a lot of indecision remains concerning the Banks.

SP500.

Sp500 is down to an old congestion zone from late December to early January.  That congestion zone is likely to provide support.  But we could see a deal of shuffling in the SP500 before an upside move can begin.

Commodities.

Commodities Index +1.07%.  Energy +1.39%.  Base Metals -0.3%.  Agriculture +0.4%.  Gold +2.16%.

Gold has been a major beneficiary of the uncertainty resulting from the crash of SVB.

Overnight in the U.S., BHP was down -1.02% after lifting in early trading.

BHP is now down to horizontal support from the lows of late-February.  

Indicators are showing possible positive divergences which suggest the falls are coming to an end.  Look for a bullish engulfing candle to confirm.

Bitcoin.

On Friday in the U.S., Bitcoin was down just -0.77% and is now showing signs of rebounding to the upside.  I'd like to see more upside and a cross above the 8-Day EMA before being sure that this is the end of the plunge in Bitcoin, but it is looking promising.

Finspiration Australia

 10/3/23.  Finspiration Friday Morning Report.

Overnight:  U.S. stocks plunge.

Dow Jones -1.66%.  SP500 -1.85%.  Nasdaq -2.05%.  Small Caps -2.36%.  Banks -7.7%.

RSI for Banks down to 21.41.  That's exceptionally low.  I'll be surprised if that doesn't result in a snap back.

SP500.

SP500 is down close to the 19 Jan. low which might act as support.

CCI (bottom panel) is showing a potential positive divergence which suggests a low is close to being made.  Wait for definite signs of a move back to the upside.

Commodities.

Commodities Index -1.22%.  Energy -1.88%.  Base Metals -1.25%.  Agriculture -0.6%.  Gold sparkled +0.98%.

After more than an hour of trading this morning, XJO is down -1.7%, with no sign of a stop to the selling.

BITCOIN.

Bitcoin fell >8% overnight.  RSI is down below 20.  I'd expect a snap-back rally here now.

Finspiration Australia.

 9/3/23.  Inspiration Thursday Evening Report.

XJO finished flat today after falling from highs around 3.00 p.m.

XJO finished up just +0.05% today.  The intra-day sell-off in the last hour is sometimes an indication that our market things the overnight results will be poor.  Today's doji candle-stick indicates indecision.

Today's action was weighed down by some big stocks going ex-dividend.  BHP fell -2.2%, Rio -2.9% and CSL -2.2%.

Myer was a screamer today, up +18.3% after giving out a good half-yearly report.

Some of the big banks did well today, ANZ +0.7%, WBC +1.2% and NAB +1.5%.  About a week ago I noted that the banks were exceedingly over-sold and to watch for a rebound.  That's coming good now.

Financials (XXJ) chart:

XXJ is back above its 8-Day EMA and Supertrend turned bullish back on Tuesday.  The trend is looking good in the short-term.

In early trading in Europe STOXX down -0.35%.

Dow Jones Futures showing -0.05%, while Nasdaq Futures are down -0.35%.

Finspiration Australia.

 8/3/23.  Finspiration Wednesday Evening Report.

From The Australian.

U.S. Markets down overnight - XJO followed down today.

XJO down today -0.77%, after J. Powell snatched away the punch-bowl just as we were getting ready to dive in.

Today's candle is a bearish engulfing candle pulling down from the 20Day MA and the 50Day MA.  Not a good look.

Trading has begun in Europe and, so far, Europe has avoided a knee-jerk reaction like Australia.  Euro STOXX600 down just -0.2%.  German DAX is up marginally, +0.04%.  Japanese Nikkei was up +0.4% today.

Only two sectors were up today, both defensives, Health +0.3% and Telecommunications +0.2%.

The worst performer was Energy -4.2%.  That was impacted by Woodside going ex-dividend.  WDS was down -7.2%.  

BHP was down -0.63% today in Australia.  In London after ninety minutes of trading this evening BHP is up +1%.  If that is an indication, our market should recover some ground tomorrow.

Finspiration Australia.

 8/3/23.  Finspiration Wednesday Morning Report.

Powell's comments sink U.S. Stocks.  Commodities down

Dow Jones -1.72%.  SP500 -1.53%.  Nasdaq -1.25%.  Small Caps  -1.0%.  Banks -3.87%.

SP500.

Selling was consistent throughout the session.  The three-day candle stick pattern is bearish after failing at the 20-Day MA.  

Last night's session broke below the 8-Day EMA and the 50-Day MA.

Support remains with the Supertrend.  Tonight's action looks crucial.

Commodities.

Commodities Index -2.05%.  Energy -2.8%.  Base Metals -2.46%.  Agriculture -0.15%.  Gold -1.75%.

After one hour of trading this morning, XJO is down -0.9%.  

Bitcoin.

Overnight, Bitcoin was down -1.59%.  It remains below the 50-Day MA and 8Day EMA.  Possible support zone is shown by the shaded rectangle.

Finspiration Australia.

 7/3/23.  Finspiration Tuesday Evening Report.

RBA announced its interest rate decision today, up +0.25%.  That may not be good news for home borrowers, but the stock market liked what it heard.  XJO up +0.49% today.  It was more or less flat when the RBA decision was announced.

I think Blind Freddy could see that this chart is looking bullish.  Today's candle finished above the 8-Day EMA and the 50-Day MA.  The Supertrend has switched from blue to yellow - bullish.

Barring nasty surprises from the U.S. tonight, we should see more upside in the near future.