Australia: S&P/ASX 200 (.AXJO) Aussie tech index launches today

Australia: S&P/ASX 200 (.AXJO) Aussie tech index launches today

Australia: S&P/ASX 200 (.AXJO) Aussie tech index launches today

Australia will finally get its own official index of publicly listed technology companies trading on the now thoroughly virtualized floor of the Australian Securities Exchange, with ratings agency Standard and Poors today launching the much awaited S&P/ASX All Technology Index.

It is understood the highly anticipated index, that many investor expect will effectively become the NASDAQ of the southern hemisphere, will initially consist of a basket of around 46 constituent stocks, including the so-called WAAAX basket – WiseTech, Afterpay, Appen, Altium and Xero.

The launch of the S&P/ASX All Technology Index is a momentous day for the local technology sector that has for the two decades arguably struggled to spark the interest of institutional and retail investors addicted to minerals, banks and telecommunications.

The creation of the All Technology Index will also go some way to eliminating the economically debilitating cultural cringe that Australian technology purchasers, especially in software, have historically exhibited, shunning local product as too risky in favour of multinationals like SAP, Oracle and IBM.

Local ASX veterans and serial entrepreneurs say the creation of the S&P/ASX All Technology Index is a good thing.

Gary Cohen, who was instrumental in the listing of Commander and IBA Health (later iSoft) and is now chief executive of Invigor Group said more business community focus on the Australian tech sector was a good thing.

“We have a very big group, a tech community here, but people have had to go offshore,” Cohen told iTnews, adding that Australia had previously lagged other countries backing their own tech industry.

Cohen also cautioned that despite some standout tech stocks rising here, the local market was somewhat polarised, with institutional investors still shunning smaller early stage companies if they were not cash flow positive.

Cohen said the companies that had done well on the ASX usually had overseas support in termns of their market, like WiseTech, that had a big international customer base.

Technical Indicators

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

The projected upper bound is: 7,302.53.

The projected lower bound is: 7,040.69.

The projected closing price is: 7,171.61.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 31 white candles and 19 black candles for a net of 12 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 72.8111. 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 66.02. 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 19 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 116.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 2 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 buy 5 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed up 17.900 at 7,162.500. Volume was 43% above average (neutral) and Bollinger Bands were 7% narrower than normal.

Open     High      Low     Close     Volume___
7,144.6007,197.2007,144.6007,162.500 832,834,240
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 7,095.79 6,933.26 6,700.15
Volatility: 6 12 14
Volume: 679,852,800 566,068,608 620,548,608

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 upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .AXJO at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on .AXJO and have had this outlook for the last 29 periods.

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