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Saturday, September 18, 2021

Australia: S&P/ASX 200 (.AXJO) gains ahead as US rallies, states ease lockdowns

Australia: S&P/ASX 200 (.AXJO) gains ahead as US rallies, states ease lockdowns

Australian shares are set to open higher as markets calmed after a wild week.

ASX futures were up 82 points or 1.6 per cent to 5298. The Australian dollar was up 0.2 per cent to 63.85 US cents.

Shayne Heffernan Trade Idea

March quarter CPI inflation data coming up this week is expected to fall 0.1 per cent quarter on quarter. “Prices for clothing and household equipment will likely also fall but food prices likely rose amidst the bushfires, drought and panic buying so underlying inflation is likely to come in around 0.3 per cent quarter on quarter or 1.5 per cent year on year.” “the relief rally will hit but I would prefer to trade it then buy and hold for now’ Shayne Heffernan PhD in Economics

Why This Matters

Gains on Wall Street and tentative steps towards relaxing lockdown restrictions point to a positive start to the Australian trading week.

ASX SPI200 index futures rallied 82 points or 1.6 per cent as US stocks rebounded into the weekend.

Risk appetite may receive another boost from news yesterday that Western Australia and Queensland will this week loosen restrictions on social behaviour. From today, West Australians will be allowed to gather in groups of up to ten people and leave home for activities such as picnics, fishing, hiking and camping. From Saturday, Queenslanders will be allowed to picnic, shop for non-essential items, visit national parks and drive up to 50 kilometres from home.

The changes in WA and Queensland represent the first relaxation of restrictions imposed last month to contain the spread of the COVID-19 virus. Queensland recorded just three new infections yesterday and WA none. Overseas, France, Spain and Britain recorded their lowest daily death tolls this month and New York announced plans to re-open the state from May 15.

US stocks climbed on Friday in a sign investors have become more comfortable with holding over the weekend as the trend in newsflow improves. The S&P 500 rose 39 points or 1.39 per cent. The Dow put on 260 points or 1.11 per cent. The Nasdaq added 140 points or 1.65 per cent.

Technical Indicators

Overall, the bias in prices is: Downwards.

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

The projected upper bound is: 5,761.96.

The projected lower bound is: 4,649.42.

The projected closing price is: 5,205.69.


A white body occurred (because prices closed higher than they opened).
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 20 white candles and 30 black candles for a net of 10 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 28.7907. This is not an overbought or oversold reading. The last signal was a buy 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 45.39. 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 20 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 -46. This is not a topping or bottoming area. The last signal was a sell 4 period(s) ago.


The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 19 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed up 25.500 at 5,242.600. Volume was 15% below average (neutral) and Bollinger Bands were 31% narrower than normal.

Open       High        Low         Close          Volume
5,217.100  5,263.800   5,207.500   5,242.600      773,936,960
Technical Outlook
Short Term:          Neutral
Intermediate Term:   Bullish
Long Term:           Bearish
Moving Averages: 10-period        50-period         200-period
Close:           5,350.11         5,753.48          6,489.69
Volatility:      33               66                36
Volume:          979,367,040      1,194,581,376     754,154,048

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.


S&P/ASX 200 is currently 19.2% below 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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