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Monday, December 6, 2021

Australia: S&P/ASX 200 (.AXJO) Investors brave another day

Australia: S&P/ASX 200 (.AXJO) Investors brave another day

Investors braved another day of wild volatility on the local sharemarket on Wednesday, as the bourse undid its gains from the previous session.

The S&P/ASX 200 Index slid 340.2 points, or 6.4 per cent, to 4953.2 wiping another $102.3 billion from the boards and closing below 5000 points for the first time since April 2016.

While shares on Wall Street enjoyed a strong session on Tuesday, rising 6 per cent, investors on the local market adopted a more cautious approach, with many shares tumbling just a day after the market soared to its best day since 1997.

The major banks were also weaker, dropping heavily across the board. Commonwealth Bank shed 5.5 per cent to $63.95, Westpac slid 7.8 per cent to $15.90, ANZ fell 9.7 per cent to $16.62 and NAB declined 7 per cent to $16.01.

Other blue chip stocks also faced heavy selling.

Macquarie Group lost 12.9 per cent to $91.05, Wesfarmers dropped 9.9 per cent to $34.20, Telstra slid 8.4 per cent to $3.18 and Suncorp Group declined 11.3 per cent to $8.60.

The miners also declined as base metal prices moved further lower.

BHP Group dropped 3.8 per cent to $27.14, Rio Tinto declined 3.7 per cent to $79.91, Fortescue Metals Group fell 3.2 per cent to $10.35 and South32 lost 10.4 per cent to close the session at $1.76.

Technical Indicators

Overall, the bias in prices is: Downwards.

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

By the way, prices are vulnerable to a correction towards 6,295.71.

The projected upper bound is: 5,478.94.

The projected lower bound is: 4,558.72.

The projected closing price is: 5,018.83.


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 26 white candles and 24 black candles for a net of 2 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 25.9726. This is not an overbought or oversold reading. The last signal was a buy 7 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 28.94. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 39 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 -103.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 10 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 sell 18 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed up 100.900 at 5,054.100. Volume was 56% below average (consolidating) and Bollinger Bands were 403% wider than normal.

Open     High      Low     Close     Volume___
4,953.2005,054.1004,953.2005,054.100 328,884,832
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 5,478.89 6,645.24 6,666.69
Volatility: 104 52 29
Volume: 1,543,284,096 890,434,176 690,001,792

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 24.2% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of .AXJO (mildly bearish). Our trend forecasting oscillators are currently bearish on .AXJO and have had this outlook for the last 16 periods. Our momentum oscillator is currently indicating that .AXJO is currently in an oversold condition.

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