Australia: S&P/ASX 200 (.AXJO) expected to rise

Australia: S&P/ASX 200 (.AXJO) expected to rise

Australia: S&P/ASX 200 (.AXJO) expected to rise

The S&P/ASX 200 index returned to form on Thursday and pushed notably higher. The benchmark index finished the day 1% higher at 6,726.6 points.

Will the local share market be able to build on this on Friday? Here are five things to watch:

ASX 200 expected to rise.   

It looks set to be a positive finish to the week for the S&P/ASX 200 index on Friday. According to the latest SPI futures, the ASX 200 is expected to open 16 points or 0.25% higher this morning. This follows a positive night of trade on Wall Street which saw the Dow Jones rise 0.7%, the S&P 500 climb 0.3%, and the Nasdaq push 0.35% higher. Optimism that a trade deal will be signed was behind this gain.

Oil prices rise.

Energy shares such as Oil Search Limited (ASX: OSH) and Santos Ltd (ASX: STO) could finish the week on a high after oil prices pushed higher. According to Bloomberg, the WTI crude oil price rose 1.4% to US$57.13 a barrel and the Brent crude oil price climbed 0.9% to US$62.29 a barrel. Trade deal optimism was also behind this solid rise.

Platinum update.

The Platinum Asset Management Ltd (ASX: PTM) share price will be on watch today after the asset manager released its monthly update after the market close. In October Platinum once again experienced net outflows. This time the outflows were approximately $252 million. This includes net outflows from the Platinum Trust Funds of approximately $212 million.

Gold price crashes.

It looks set to be a disappointing finish to the week for Australia’s gold miners. The likes of Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) could tumble after the gold price crashed lower. According to CNBC, the spot gold price fell 1.65% to US$1,468.40 an ounce. Trade deal hopes weighed on the safe haven asset.

Avita added to ASX 200.

The Avita Medical Ltd (ASX: AVH) share price could be on the rise after it was added to the ASX200. It will replace Aveo Group (ASX: AOG) in the benchmark index on November 14 when Brookfield Asset Management Inc acquires the retirement communities company.

Technical Indicators

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 6,629.74.

The projected upper bound is: 6,860.84.

The projected lower bound is: 6,601.13.

The projected closing price is: 6,730.98.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 33 white candles and 17 black candles for a net of 16 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 60.9699. This is not an overbought or oversold reading. The last signal was a sell 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 56.57. 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 88 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 33. This is not a topping or bottoming area. The last signal was a sell 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 sell 4 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed up 66.400 at 6,726.600. Volume was 3% below average (neutral) and Bollinger Bands were 50% narrower than normal.

Open     High      Low     Close     Volume___
6,660.2006,727.7006,659.7006,726.600 613,235,008
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 6,701.81 6,658.19 6,448.65
Volatility: 10 12 13
Volume: 573,654,336 629,204,608 642,348,864

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 4.3% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 8 periods.

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