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

 18/6/22.  Yesterday in Australia.

Yesterday, the ASX200 (XJO) was down -1.8%.

Below is the chart for STW - ETF for the ASX200.  I've chosen the STW chart today rather than the XJO chart because STW chart is somewhat more realistic in showing the market than the XJO.  XJO always starts where the previous day leaves off - so it is always continuous.  STW opens either up or down from the previous day's close.  Those gaps are often small, or, as in recent days quite large.  It also allows us to see more clearly the intra-day action in the market.

Friday's candle shows an opening gap down of >2%.  It then fell more (long lower wick) then recovered somewhat to finish above its opening quote.  So we did see some intra-day buying, which didn't occur on Thursday when the candle was basically all blue, i.e., it fell from its opening quote and didn't recover.

I've also shown on this chart the clear Head/n/Shoulders pattern which formed from late February into early June, with the Head forming in early April.

The fall from the Head to the  Base Line is >8%.  The fall from the Base Line to the low of yesterday's candle is ~7%.  So, if the Standard Measure Rule (SMR) is followed, STW still has about -1% to fall before we get a rebound.  SMR is never 100% accurate, but provides a guide to investors watching for a Point of Interest, give or take a bit, where a rebound might occur.

Are we there yet?  Maybe, start looking for a rebound now.  Any rebound will, however, probably be a counter-trend rally while Central Banks around the world continue to turn the interest rate screws to counter inflation.

Overnight.

Dow Jones flat -0.13%.  SP500 +0.22%.  Nasdaq +1.43%.  Small Caps +0.7%.  Banks +0.88%.

Yesterday in America was Options Expiry Day, which leads to much higher volumes.

SP500.

SP500 is now down -24.5% since its high in early January.

The Options Expiry Week shows a statistical bias to the positive side.  It certainly didn't happen this week with the SP500 down -6%.  Bear Markets ruin every edge that statistics provide to the trader.

Here's a weekly chart for SP500:

This chart provides clues to a possible "bottom" in this bear market.  

The 50% retracement level is shown from the bear market low of March 2020 to the high of the rally in early January 2022.  That level is at 3502.6.  SP500 finished Friday at 3666.8

The 50% retracement level more or less coincides with the 200-Week Moving Average and horizontal support/resistance from August-November 2020.

So, we have triple alliances occurring around the 50% retracement level.  That's powerful stuff.

I've also calculated a turn date (using Gann measure principles) of 26 June, give or take a couple of days.  Another week of down time would bring the SP500 down to about that triple alliance.

Look for a rebound around that level, i.e., in round numbers 3500. 

Good luck.

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

 17/6/22.  Overnight U.S. equities resume the bearish trend.

Dow Jones -2.42%.  SP500 -3.25%.  Nasdaq -4.08%.  Small Caps -4.89%.  Banks -2.79%

SP500.

After a brief hiatus on Wednesday, SP500 turned lower on Thursday.  

Double positive divergences on MACD and Histogram continue to suggest at we will get an upside move in the near future.  Wait for a cross of the Stochastic above 20 before going long.

Commodities.

Commodities Index +0.44%.  Energy +0.24%.  Base Metals continue to languish, -1.81%.  Agriculture +1.01%.  Gold +1.12%.  Gold is benefitting from a lower U.S. dollar - but

that is not helping Base Metals.

Iron Ore. -0.3%.  Thermal Coal +0.3%.

Overnight Oz Futures -2.1%.

Bitcoin.

Bitcoin is at support of the 200-Week Moving Average where it found support in 2019 and 2020.

It remains in a down-sloping channel.  It may now move up to test the upside of that channel.

Until it breaks out of that channel a failure of the 200-Week MA as support is likely.

A price then in the low 11,000s seems likely.

I must admit to a bias against bitcoin.  It is basically an abstract concept with no intrinsic value.  It only has the value people will put on it, i.e., it is pure speculation.

People with a knowledge of history will know that the man who "discovered" gravity, Isaac Newton, one of the greatest mathematicians of all time, went broke speculating during the Dutch Tulip mania.  

Buyer beware.

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

 16/6/22.  XJO finished flat today -0.15% after being up >1% in early trading.

Today was a reversal day - that's not uncommon as an Index searches for a "bottom".  Such action at the top of a trend is negative - at the bottom of a trend it suggests the opposite.

RSI14 is very oversold at 25.03.  We don't often see readings like that without a short-term rebound.

Breadth today was OK with 898 Advancing Issues and 583 Declining Issues.

Four Sectors were up today Energy +0.48%.  Materials +0.38%.  Communication Services +0.53%, and surprisingly, Property +1.2% (the best performing Sector).

GMG is the largest stock in the Property Sector.  It was up today +2.39%.

Positive Divergences, particularly on MFI, suggest the next move will be to the upside.  Watch.

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

 16/6/22.  Overnight.

The American Federal Reserve increased interest rate by +0.75%.  That didn't phase the market - that news was already priced into stocks.  European bonds had rallied earlier in the session sent sent Euro stocks higher, and the U.S. followed suit.

Dow Jones +1%.  SP500 +1.48%.  Nasdaq +2.5%.  Small Caps +0.88%.  Banks +1.58%.

SP500

SP500 rose yesterday after leading indicators like MACD and Histogram were showing positive divergences.

Stochastic is lifting up but still in the oversold range.  A rise above 20 would give a short-term buy signal.

Commodities.

Commodities Index flat +0.07%, after Energy fell -0.47%, but Base Metals up strongly +1.97%.  Agriculture also flat +0.05%.  Gold up +1.31%.

Iron Ore down -2%.  Thermal Coal +0.7%.

Overnight oz Futures +0.3%.  That looks relatively pessimistic.

Finspiration Australia. Chart Analysis for Australian and International Markets.

 XJO down today -1.27%.

The above chart is a weekly chart for XJO.  It is clearly bearish and broke below a major support level today.

Here's the daily chart for the XJO.

Yesterday, XJO completed a bearish Head/n/Shoulders formation and continued lower today.

Here's the projection for the current Head/n/Shouders top:

I'm not particularly confident in H/n/S Top projections.  But it is what it is.  The projection suggests a bottom for this pull-back of 6248.  XJO finished today at 6601.  That suggests another -5.3% to the downside.

Today started with a downside move, then a rebound.  The Fair Work Commission then announced a wage rise of 5.2% for minimum wage earners.  No one can begrudged them that, but the XJO saw lower profits, so it fell.  After stabilising, the market went into reverse gears at 1.25 p.m.  Why?  No idea.  But here's the intra-day chart:

The XJO remains bearish - don't buck the trend.

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

 Special Edition for Bitcoin.

Bitcoin has formed a large double top.  Standard Measure Rule suggests Bitcoin will go below zero.  That seems a bit extreme.  (Understatement of the year.). 5000 seems like a reasonable target based on support levels.

Finspiration Australia. Chart Analysis for Australian and International Markets.

 Here's a special on Bitcoin.

Bitcoin has formed a clear double top.  A standard measure rule suggests Bitcoin will go below zero.

Well - that seems a bit extreme, but a fall to near zero does seem possible.  US$5000 anyone?