8/6/23. Thursday Morning Finspiration Report.

Dow Up, Nasdaq Down, Mid and Small Caps going berserk.  

Dow Jones +0.27%.  SP500 -0.38%.  Nasdaq -1.29%. Mid-Caps +1.52%.  Small Caps +2.4%.  Banks +1.4%.

Market is healthier than the major indices suggest.

6/6/23. Tuesday Evening Finspiration Report.

 XJO mugged by the RBA at 2.300 p.m. today.  XJO finished down -1.2%.

At 2.30 p.m just before the RBA announced its interest rate decision, the XJO was down a little.  The RBA decision to raise interest rates again (+0.25%) put the XJO into a precipitous dive.  

Only one sector escaped the carnage - Utilities (XUJ) up +0.54%.  I guess people won't be turning off their heaters as winter descends upon us.  But Discretionary Spending will be cut back, again. XDJ (Discretionary) was the worst hit sector, down -2.16%.  

Industrials (XNJ) was the next worst sector, down -1.56%.  Does that suggest our national economy is headed for recession?  Maybe.

Information Technology (XIJ) didn't fare too badly, only down -0.19%.

But Health Care (XHJ) was hit, down -1.39%.  Do people spend less on Health Care in order to pay their mortgage.  Probably.

Looking at the chart, however, it remains in a sideways movement, held up by the 200-Day MA and restrained by the 5-Day and 30-Day MAs.

While the XJO can hold above the 200-Day MA, there's room for a little optimism.

Not much coming out of Europe, STOXX600 down -0.11%.

American Futures are also docile, but leaning to the down side.  DJ Futures -0.14%. SP500 Futures -0.09%.  Nasdaq Futures -0.02%. 

6/6/23. Tuesday Morning Finspiration Report.

 Commodities and stocks both pulled back last night.

U.S. Indices.

Dow Jones -0.59%.  SP500 -0.2%.  Nasdaq -0.09%.  Mid Caps -1.09%. Small Caps -2.03%.  Banks -1.11%.

SP500

SP500 remains in a strong up-trend.  Last night's candle looks lie a pause after two strong days to the upside.  We could see a pull-back to the top of the 30 May candle.

Commodities.

Commodities Index -0.26%.  Energy -0.1%.  Back Metals -0.22%.  Agriculture -0.14%.  Gold +0.6%.

After 30 minutes of trading this morning, XJO is down -0.7%.

Discretionary and Staples sectors are the worst - probably fretting about the RBA's interest rate decision coming out at 2.30 p.m.

5/6/23. Monday Evening Finspiration Report.

XJO up strongly today, +1%.

 

XJO is now stuck between the 50-Day MA and the 200-Day MA.  It might take a day or two to get over the resistance of the 50-Day MA (and Supertrend 11-2).

All indicators in the lower panels are in "buy" positions - so that's a big positive.

I'd expect the next significant move to be to the upside.

4/6/23. Sunday Weekly Finspiration Report.

Despite all the hoo-ha about the U.S. Debt Ceiling in the media, not much movement occurred in the Oz market this week.  But, the media got its action on Friday night when the Dow Jones rose +2.12%, US Mid Caps rose +3.27%, U.S. Small Caps +4.06%.

Oz market will almost certainly follow to the upside on Monday

Let's get into the details.

XJO Daily Chart.

The chart remains in a down-trend.  On Wednesday and Thursday it hit the lower edge of the Standard Error Channel then bounced on Friday back above the 200-Day MA.  That's encouraging for the bulls but the chart needs to close Monday's high (circled) and get above the 50-Day MA (blue dotted line).

Until we see a significant break of structure by setting up a higher high and higher low, we have to presume the down-trend remains in place.

American SP500.

Unlike the Australian XJO, the American SP500 is in a strong up-trend.  Friday's night action broke above its restraining up-trend line.  Friday saw the SP500 up +1.45%

Just above the high of Friday is a major horizontal resistance level which was set back in August, 2022.  That might cause the SP500 to stutter.

CCI shows a negative divergence suggesting we might see a pull-back in the near future.

Sector Performance this past week.

XJO was down a little this week but -0.14%, as usual, we had a wide variation in sector performances.

Of particular note is the poor performance of both cynical and defensive retailers.  Discretionary -2.21% and Staples -1.27%.  Until the Reserve Bank starts easing off the interest rate increases, the retailers will make heavy weather.

XXJ (Financials) also did poorly - 1.36%

The big banks are largely behind the poor performance in XXJ.  Despite the banks recently reporting good results (earnings up, interest margins, Return on Equity - all improving), the market is looking at deteriorating credit impairment charges, rising funding costs and increasing operating costs, not the least of which is due to inflation. While those conditions remain, it might be best to give the big banks a miss.

The big improver this week was XMJ (Materials) after iron iron prices were on the up.  The big miners are ones to watch.  BHP and Rio have been in down-trends since early this year.  This week's good performance didn't do anything to change that bigger picture.  Both the big miners are sitting around their 200-Day MAs.  Rio, for example, needs to get back above major horizontal resistance and the 50-Day MA to prove its bullish credentials.

Sector Momentum.

A quick way to check momentum is to look at the difference between weekly and daily RSI.  If daily RSI is below weekly RSI, then momentum is negative, or bearish.  Vice versa, if daily RSI is above weekly RSI, then momentum is positive or bullish. 

The above profile is indicative of a bearish market.  Only two sectors are showing positive momentum, XIJ and XEJ.  XXJ is flat, so it could be about to turn around from its current poor performance (see above).

Look to strong stocks in sectors with positive momentum.

Conclusion.

The Australian market has been in a down-trend since mid-April.  That's in stark contrast to the American market, buoyed by rampaging tech stocks, has been in an up-trend since mid-March.

No doubt we will see a big upside move on Monday, but, until we see more sustained moves to the upside, doubts must remain about the Australian market.

3/5/23. Saturday Finspiration Report.

 XJO up moderately yesterday.  Dow Jones - Whooshka.

XJO has bounced up off the 200-Day MA.  200DMA acts as a marker between bearish and bullish, so that's a promising development.

Modest positive divergences on RSI and CCI suggest further upside.

Other than that - the chart remains bearish, and the current move is a counter-trend rely.

My opinion might change on Monday as a result of amazing conditions in the U.S. last night.

U.S. Indices.

Dow Jones +2.12%. SP500 +1.45%.  Nasdaq +1.07%.  Mid Caps +3.27%.  Small Caps +4.06%.  Banks +3.74%.

The Dow Jones has a huge daily candle on it.  More importantly, we also have huge daily candles on the Mid Caps and Small Caps.  The big worry recently in the U.S. market has been the lack of breadth.  A few big names on the Nasdaq have been doing the heavy lifting for the market with a lack of breadth.  That has now been done away with because of the surge in the Mid Caps and Small Caps.

SP500.

This chart is bullish.  A major horizontal resistance lies just above the Index.  That's the high from mid-August 2022.  That might cause the market some difficulty but with a broad based rally it should be able to push up past that after some stuttering.

Commodities.

Commodities were also bullish on Friday night in the U.S..

Commodities Index +1.29%.  Energy +2.35%.  Base metals +0.5%.  Agriculture +0.58%.  Gold fell -1.47%.

Ozzie stocks in NY enjoyed a good night.  BHP +4.13%.  Rio +3.49%.  Woodside +2.6%.

2/6/23. Friday Morning Finspiration Report.

U.S. stocks rise strongly.

 Dow Jones +0.47%.  SP500 +0.99%.  Nasdaq +1.28%.  Mid Caps +0.81%.  Small Caps +0.86%.  Banks +1.61%.

SP500.

SP500 is knocking on resistance from Friday's high.  With negative divergence on the CCI that sets up the possibility of a double top.

Commodities.

Commodities Index +1.63%.  Energy +2.19%.  Base Metals +1.02%.  Agriculture +1.47%.  Gold +0.79%.

With Stocks and Commodities up strongly, Australia is set for a strong Friday.