Australia: S&P/ASX 200 (.AXJO) plunges 2% ahead of March jobs data

Australia: S&P/ASX 200 (.AXJO) plunges 2% ahead of March jobs data

Australia: S&P/ASX 200 (.AXJO) plunges 2% ahead of March jobs data

Australian shares have recorded sharp early losses as global equities sour and a likely bleak unemployment figure looms.

The S&P/ASX200 benchmark index was down 101.7 points, or 1.86 per cent, at 5365.0 points after 30 minutes of trade on Thursday, ahead of a widely expected announcement of an uptick in the jobless rate for March.

The bourse had fallen by 2.1 per cent in the first 15 minutes of trade.

The All Ordinaries index was down 102.8 points, or 1.86 per cent, to 5420.5.

Nearly all sectors were in the red, with the financials, miners, consumer discretionaries and property firms losing heavily.

The big banks were hit hard. Commonwealth Bank fell by 2.66 per cent to $60.42, Westpac dropped 3.59 per cent to $15.705, NAB shed 3.37 per cent to $16.08 and ANZ fell by 3.38 per cent to $16.28.

Macquarie Group dropped 2.1 per cent to $98.84 while Bendigo Bank, which has withdrawn its second-half outlook commentary, lost 3.39 per cent to $5.98.

Crown Casino shares fell by 2.06 per cent to $8.09 after the company stood down 11,500 of its employees because of the coronavirus restrictions affecting its casinos in Melbourne and Perth.

The jobless rate for March is tipped to rise from 5.1 per cent to 5.4 per cent in figures due to be released by the Australian Bureau of Statistics at 1130 AEST.

Economists say the figure could be the tip of the iceberg as widespread COVID-19 shutdowns and social restrictions were not implemented until the second half of the month, meaning the April data will be worse again.

Toll giant Transurban also fell at the open, losing 3.65 per cent to $12.41 after car trips on nearly all the company’s Australian roads fell in the three months to March 31.

Big miner BHP dropped 3.85 per cent to $30.22, Rio Tinto slumped by 1.82 per cent to $88.15 and Fortescue Metals shed 2.54 per cent to $11.11.

The energy sector was down by a collective 1.88 per cent on an overnight oil price slump.

Woodside Petroleum fell by 1.63 per cent to $20.875 after posting a more than 20 per cent fall in first-quarter sales revenue.

Biotech CSL was up 0.19 per cent to $324.75, while A2 Milk was up 2.27 per cent to $18.51 to keep consumer staples flat.

The major US indices plunged overnight as dismal economic data and first-quarter earnings reports sent investors scurrying.

The Australian dollar was buying 63.06 US cents at 1030 AEST, down from 63.54 US cents at the close of markets on Wednesday.

Technical Indicators

Overall, the bias in prices is: Downwards.

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

The projected upper bound is: 5,920.26.

The projected lower bound is: 4,810.65.

The projected closing price is: 5,365.46.

Candlesticks

A black body occurred (because prices closed lower 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 22 white candles and 28 black candles for a net of 6 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 83.5073. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 15 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 49.12. 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 14 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 102.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 4 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 13 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -70.200 at 5,396.500. Volume was 43% below average (neutral) and Bollinger Bands were 17% wider than normal.

Open High Low Close Volume___
5,466.7005,466.7005,345.0005,396.500 493,923,040
Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 5,296.50 5,962.31 6,531.94
Volatility: 43 66 36
Volume: 992,440,512 1,148,031,360 740,273,792

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.

Summary

S&P/ASX 200 is currently 17.4% 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 2 periods.

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