Australia: S&P/ASX 200 (.AXJO) recorded its biggest percentage loss in eight weeks

Australia: S&P/ASX 200 (.AXJO) recorded its biggest percentage loss in eight weeks

Australia: S&P/ASX 200 (.AXJO) recorded its biggest percentage loss in eight weeks

The Australian sharemarket recorded its biggest percentage loss in eight weeks on Tuesday as the major miners fell and index heavyweights traded without the value of their next dividend payment.

The S&P/ASX 200 Index fell 57.9 points, or 0.9 per cent, to 6128.4 while the broader All Ordinaries closed 54.6 points, or 0.9 per cent, lower at 6209.

Some modest losses from the major banks also weighed on the market. Commonwealth Bank fell 0.8 per cent to $73.15, Westpac slipped 1 per cent to $26.53, ANZ declined 1.2 per cent to $27.69 and NAB closed at $24.60, down 0.5 per cent.

Consumer confidence weakened slightly last week in the face of the increasing prospect the Reserve Bank of Australia will cut rates, and issues around China’s importation of Australian coal. Despite a small dip, the ANZ-Roy Morgan Australian Consumer Confidence index is remaining above the long-run average. “The fall was somewhat surprising considering strong employment growth and reasonable wage data,” said ANZ’s head of Australian economics David Plank. “The turn to a more negative outlook by one of the major Australian banks and news stories about a ban on Australian coal imports by Chinese port authorities that were then denied by authorities may have offset the positive economic data.”

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 5,960.80.

The projected upper bound is: 6,263.46.

The projected lower bound is: 6,012.34.

The projected closing price is: 6,137.90.

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 29 white candles and 21 black candles for a net of 8 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 77.3493. 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 65.67. 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 92. 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 -57.900 at 6,128.400. Volume was 17% above average (neutral) and Bollinger Bands were 4% wider than normal.

Open High Low Close Volume___
6,186.3006,186.3006,106.0006,128.400 726,474,432

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

Moving Averages: 10-period 50-period 200-period
Close: 6,110.35 5,847.15 6,009.33
Volatility: 8 14 14
Volume: 705,054,016 604,199,104 596,716,160

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 2.0% 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 35 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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