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Australia: S&P/ASX 200 (.AXJO) has pulled back from its record highs despite gains for the energy sector

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Australia: S&P/ASX 200 (.AXJO) has pulled back from its record highs despite gains for the energy sector

The Australian sharemarket has pulled back from its record highs despite gains for the energy sector.

The benchmark S&P-ASX 200 index finished down 32.5 points to 6,812.6 points on Wednesday, while the all ordinaries closed down 31.6 points to 6,896.7.

“Today the market has come back to earth after yesterday’s record highs,” said CommSec market analyst James Tao, referring to the ASX200 on Tuesday eclipsing its all-time high set in 2007.

Markets were also lower in the US and Europe, and investors were distracted ahead of a US decision on interest rates and US-China trade talks underway in Shanghai.

“There has been a little bit of action on the domestic front as well,” Mr Tao observed.

Government figures announced on Wednesday showed that lending to businesses fell in June, while inflation for June narrowly beat expectations but economists said it was probably not enough to ward off a third rate cut by the end of the year.

Overall, the bias in prices is: Upwards.

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

The projected upper bound is: 6,929.81.

The projected lower bound is: 6,707.89.

The projected closing price is: 6,818.85.

Candlesticks

A black body occurred (because prices closed lower than they opened).
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 74.5822. 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 63.58. 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 17 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 93. 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 buy 4 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -32.500 at 6,812.600. Volume was 24% above average (neutral) and Bollinger Bands were 2% wider than normal.

Open     High      Low     Close     Volume___
6,845.1006,845.1006,812.6006,812.600 760,136,768

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

Moving Averages: 10-period     50-period     200-period
Close: 6,763.68 6,609.71 6,136.20
Volatility: 9 11 14
Volume: 605,741,632 641,419,392 624,266,304

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 11.0% 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 36 periods.

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