Australia: S&P/ASX 200 (.AXJO) extending a losing streak amid rising evidence of slowing global growth

Australia: S&P/ASX 200 (.AXJO) extending a losing streak amid rising evidence of slowing global growth

Australia: S&P/ASX 200 (.AXJO) extending a losing streak amid rising evidence of slowing global growth

Sigma Healthcare’s decision to rebuff Priceline-owner Australian Pharmaceutical Industries’s $730 million takeover bid triggered the biggest drop on the S&P/ASX 200 Index on Wednesday.

The ASX 200 closed 14 points, or 0.2 per cent, lower at 6161.2 points, extending a losing streak that began on Friday amid rising evidence of slowing global growth.

Most regional indices fell, including Japan’s Nikkei 225 Index, which declined 1.2 per cent to 21,254.3 points upon the release of weak industrial sector data, and New Zealand’s S&P/NZX 50, which dropped 0.1 per cent to 9,387 points.

Artificial intelligence provider Appen was an outlier with its 5.1 per cent rally to $23.27. Appen conducted a $285 million capital raising to fund its purchase of the machine-learning software business Figure Eight, causing the stock to fall more than 9 per cent in Tuesday’s session.

The Westpac-Melbourne Institute consumer sentiment index fell 4.8 per cent to 98.8 points in March from a reading of 103.8 in February. That reduced sentiment to its lowest level since September 2017. Commonwealth Bank economist Gareth Aird speculated that the slowdown in fourth-quarter economic growth and discussion of a “per capita” recession. However, as Mr Aird noted, job security fears rose sharply which is at odds with the January employment survey which showed the unemployment rate is at 5 per cent. “It looks like the Australian consumer needs a circuit breaker. And the sooner the better,” he concluded.

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 6,016.13.

The projected upper bound is: 6,277.67.

The projected lower bound is: 6,065.32.

The projected closing price is: 6,171.50.

Candlesticks

A black body occurred (because prices closed lower 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 30 white candles and 20 black candles for a net of 10 white candles.

A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

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 13.2027. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 3 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 56.81. 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 3 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 -80. This is not a topping or bottoming area. The last signal was a sell 3 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 3 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -13.600 at 6,161.200. Volume was 11% above average (neutral) and Bollinger Bands were 34% narrower than normal.

Open High Low Close Volume___
6,174.8006,174.8006,127.3006,161.200 691,281,792

Technical Outlook
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 6,200.79 5,981.17 6,017.52
Volatility: 9 11 14
Volume: 689,121,664 612,525,824 604,342,400

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 2.4% above its 200-period moving average and is in an upward trend. Volatility is relatively normal 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 46 periods. our momentum oscillator has set a new 14-period low while the security price has not. This is a bearish divergence.

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