Australia: S&P/ASX 200 (ASX:.AXJO) renewed worries about the trade conflict between the US and China is set to put investors in a defensive mood

Australia: S&P/ASX 200 (ASX:.AXJO) renewed worries about the trade conflict between the US and China is set to put investors in a defensive mood

Australia: S&P/ASX 200 (ASX:.AXJO) renewed worries about the trade conflict between the US and China is set to put investors in a defensive mood

ASX futures were down 22 points or 0.3% to 6499. The local currency slipped 0.2 per cent.

On Wall Street, the Dow dipped 0.3 per cent, the S&P 500 slid 0.7 per cent and the Nasdaq fell 1 per cent.

“The whole week was characterised by stocks battered up one way and down the next in the war of words between Trump and China,” Fundstrat’s Vito Racanelli said in a note.

On the week, the Standard & Poor’s 500 index finished at 2919, down a few points, or less than 0.5%, from the previous Friday’s 2932. “In between, however, a thrill ride,” Mr Racanelli said. The SPX rose to as high as 2939 and as dropped as low as 2822.

Mr Racanelli said though it appears to be a side show, the second quarter earnings reporting season is coming to an end soon. So far, it looks like it will be the second quarter in a row of negative EPS growth.

For local investors this week, there’s a NAB business survey tomorrow, followed by wage data on Wednesday and a speech on ‘Risks to the Outlook’ by RBA deputy governor Guy Debelle on Thursday.

Thursday also will be in focus with July’s jobs report. The “labour force survey should show a modest gain in jobs of 15k with unemployment ticking up to 5.3%”, NAB’s Kaixin Owyong said.

“Weak outcomes [in this week’s data] would place pressure on the Reserve Bank to cut again given that the board said it was watching labour market developments closely,” Ms Owyong also said.

Overall, the bias in prices is: Sideways.

The projected upper bound is: 6,729.31.

The projected lower bound is: 6,447.19.

The projected closing price is: 6,588.25.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 29 white candles and 21 black candles for a net of 8 white candles.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

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 32.6743. This is not an overbought or oversold reading. The last signal was a buy 1 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 42.82. 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 24 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 -84. This is not a topping or bottoming area. The last signal was a buy 0 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 4 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed up 16.300 at 6,584.400. Volume was 8% above average (neutral) and Bollinger Bands were 58% wider than normal.

Open     High      Low     Close     Volume___
6,568.1006,592.5006,562.5006,584.400 664,700,544
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 6,683.14 6,632.12 6,161.56
Volatility: 20 14 14
Volume: 656,410,688 647,530,368 627,798,272

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 6.9% 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 4 periods.

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