Australia: S&P/ASX 200 (.AXJO) fell after solid US data dampened expectations the Fed would cut rates

Australia: S&P/ASX 200 (.AXJO) fell after solid US data dampened expectations the Fed would cut rates

Australia: S&P/ASX 200 (.AXJO) fell after solid US data dampened expectations the Fed would cut rates

Australian shares fell heavily on Monday after a solid US non-farm payrolls print dampened market expectations the Federal Reserve would cut rates more than twice this year.

The S&P/ASX 200 Index posted its biggest one-day fall since June 3, closing 79.1 points, or 1.2 per cent lower, at 6672.2. The broader All Ordinaries dropped 74.4 points, or 1.1 per cent, to 6757.4.

“The non-farm payrolls numbers released on Friday night upset the market applecart,” said CMC Markets chief market strategist Michael McCarthy.

“A key factor in recent market moves is the belief that weaker growth will bring further stimulus [and] the 224,000 US jobs created in June directly contradicts that belief.

Overall, the bias in prices is: Upwards.

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

By the way, prices are vulnerable to a correction towards 6,449.23.

The projected upper bound is: 6,800.85.

The projected lower bound is: 6,555.02.

The projected closing price is: 6,677.93.

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 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 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 66.9219. 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 59.36. This is not a topping or bottoming area. However, the RSI just crossed below 70 from a topping formation. This is a bearish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 0 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 89. This is not a topping or bottoming area. The last signal was a sell 0 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 0 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -79.100 at 6,672.200. Volume was 28% below average (neutral) and Bollinger Bands were 3% narrower than normal.

Open High Low Close Volume___
6,740.0006,751.3006,672.2006,672.200 457,990,336

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

Moving Averages: 10-period     50-period     200-period
Close: 6,671.19 6,475.88 6,084.81
Volatility: 11 12 14
Volume: 624,265,216 638,815,296 627,188,352

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 9.7% above 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 19 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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