Australia: S&P/ASX 200 (.AXJO) Expected to Open Higher

Australia: S&P/ASX 200 (.AXJO) Expected to Open Higher

Australia: S&P/ASX 200 (.AXJO) Expected to Open Higher

Australian shares are set to open higher before a huge week of local data including third quarter growth statistics on Wednesday. Ahead of the GDP report however is tomorrow’s RBA policy meeting. ASX futures were 25 points higher over the weekend.

Today the focus is likely to be on reaction to the weekend meeting between Donald Trump and Xi Jinping after the two presidents agreed to a 90-day trade war truce. The G20 communique made clear that the Trump administration’s protectionist tilt remains a dominant force and as a result, downside risks to global growth remain ascendant.

Later in the week OPEC meets to discuss a potential production cut in the wake of the recent plunge in prices and Mr Trump’s continued harping. And finally, there’s the US November jobs report, a key data point for an increasing data dependent US central bank.

RBA commodity index SDR November; AIG manufacturing index November; building permits October; business inventories Q3; ANZ job advertisement November.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 5,898.14.

The projected upper bound is: 5,814.98.

The projected lower bound is: 5,498.32.

The projected closing price is: 5,656.65.

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 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 25 white candles and 25 black 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 57.6833. 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 38.84. 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 buy 23 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 -35. 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 2 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -91.200 at 5,667.200. Volume was 100% above average (neutral) and Bollinger Bands were 40% wider than normal.

Open High Low Close Volume___
5,758.4005,758.4005,667.2005,667.2001,215,747,712

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 5,696.64 5,892.01 6,042.31
Volatility: 15 17 12
Volume: 681,560,192 615,404,480 586,202,240

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 6.2% below its 200-period moving average and is in an upward 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 bullish on .AXJO and have had this outlook for the last 1 periods.

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