Australia: S&P/ASX 200 (.AXJO) bullish as big banks all made strong gains

Australia: S&P/ASX 200 (.AXJO) bullish as big banks all made strong gains

Australia: S&P/ASX 200 (.AXJO) bullish as big banks all made strong gains

The S&P/ASX 200 enjoyed a bullish session that saw the index gain 84.5 points to rise 1.3 per cent to a two-week high of 6736.5. Volumes were high at 609 million and the session ended with just 29 companies in the red. The most points were added by CSL, which hit historical highs and closed at $253, and Wesfarmers gained 2.8 per cent to close at $40.65. 

The big banks all made strong gains and Telstra was up 2 per cent to $3.61. The biggest gain was gold miner Silver Lake Resources, up 8.3 per cent, followed by gains of more than 7 per cent in CYBG Plc and nearmap Ltd. 

The biggest percentage decline and drag on the market was Afterpay Touch, which dropped 7.2 per cent to $33.92 after UBS initiative coverage with a ”sell” recommendation and a target price of $17.25. And Southern Cross Austero dropped a further 6.4 per cent to 88¢. Iron ore producers were under pressure with Rio Tinto falling 0.9 per cent, BHP 0.1 per cent, and Fortescue falling 1.6 per cent. Gold miners also fell as the precious metal hit a two-week low. 

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 6,899.15.

The projected lower bound is: 6,582.53.

The projected closing price is: 6,740.84.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 33 white candles and 17 black candles for a net of 16 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 88.6412. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 6 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 59.79. 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 72 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 90. This is not a topping or bottoming area. The last signal was a buy 6 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 1 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed up 84.500 at 6,736.500. Volume was 4% below average (neutral) and Bollinger Bands were 3% wider than normal.

Open     High      Low     Close     Volume___
6,652.0006,737.8006,652.0006,736.500 626,537,536
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 6,589.88 6,600.53 6,376.52
Volatility: 18 15 13
Volume: 512,685,504 664,515,712 632,331,904

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 5.6% above its 200-period moving average and is in an downward trend. Volatility is high 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 bearish on .AXJO and have had this outlook for the last 7 periods.

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