Australia: S&P/ASX 200 (ASX:.AXJO) market lost $60 billion in value, completing the wipeout of all the gains it made over the past two months

Australia: S&P/ASX 200 (ASX:.AXJO) market lost $60 billion in value, completing the wipeout of all the gains it made over the past two months

Australia: S&P/ASX 200 (ASX:.AXJO) market lost $60 billion in value, completing the wipeout of all the gains it made over the past two months

The benchmark ASX 200 index closed 2.9 per cent lower at 6,408, a stunning retreat from its record high reached on July 30.

It was the worst one-day fall for the benchmark index since February 2018, narrowly eclipsing a 2.83 per cent decline last October.

The broader All Ordinaries index dropped by 2.8 per cent to 6,491, with companies on that index collectively shedding about $60 billion in market value.

It came after Wall Street suffered its worst one-day fall of 2019 on heightened fears of a United States recession, triggering a sell-off across global markets.

The likelihood of the US falling into recession next year is “growing”, with bond markets pricing in a 38 per cent chance, Fidelity International’s cross asset investment specialist Anthony Doyle said.

“While we don’t expect an imminent recession, the case for further rate cuts in the US is getting stronger,” he said.

He also said the US Federal Reserve would have little choice but to “ease rates, thus keeping US Government bonds from rising materially”.

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 6,568.45.

The projected lower bound is: 6,249.73.

The projected closing price is: 6,409.09.

Candlesticks

A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 52.1636. This is not an overbought or oversold reading. The last signal was a sell 0 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 32.49. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 28 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -99. This is not a topping or bottoming area. The last signal was a buy 4 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 8 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -187.800 at 6,408.100. Volume was 44% above average (neutral) and Bollinger Bands were 83% wider than normal.

Open     High      Low     Close     Volume___
6,595.9006,595.9006,405.6006,408.100 893,233,472
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 6,572.18 6,647.21 6,177.94
Volatility: 24 15 14
Volume: 692,251,648 649,535,808 627,508,992

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

S&P/ASX 200 is currently 3.7% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of .AXJO at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .AXJO and have had this outlook for the last 8 periods. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.

The following two tabs change content below.
HEFFX has become one of Asia’s leading financial services companies with interests in Publishing, Private Equity, Capital Markets, Mining, Retail, Transport and Agriculture that span every continent of the world. Our clearing partners have unprecedented experience in Equities, Options, Forex and Commodities brokering, banking, physical metals dealing, floor brokering and trading.

You must be logged in to post comments :  
CONNECT WITH