Australia: S&P/ASX 200 (.AXJO) set for a mixed start to the trading week

Australia: S&P/ASX 200 (.AXJO) set for a mixed start to the trading week

Australia: S&P/ASX 200 (.AXJO) set for a mixed start to the trading week

S&P/ASX200 Index futures are down 3 points, suggesting a mixed start to the trading week.

However, rising hopes of a US-China trade deal after a “constructive” weekend phone call between negotiators may fuel the momentum in blue chip stocks that has propelled the S&P/ASX200 Index to within 52 points of its July 30 record high.

Wall Street’s record-breaking session on Friday – the Dow Jones Industrial Average broke through 28,000 points for the first time – underscored the renewed bullish sentiment among investors who are betting a “phase one” trade deal could lay the foundation for a recovery in global growth in 2020.

The Dow rose 0.8 per cent to 28,004.89. The S&P500 Index rose 0.77 per cent to a record high of 3120.46 and the technology-laden Nasdaq Composite added 0.73 per cent to end at a record 8540.83 points.

Australia’s largest companies – spearheaded by biopharmaceutical giant CSL – have powered higher as investors have focused on hopes for a rebound in global growth and earnings, should a trade deal be struck, and the prospect of more interest rate cuts from the Reserve Bank of Australia.

Stimulus from big central banks like the US Federal Reserve and European Central Bank have also raised expectations for a recovery in growth. The Fed has cut rates three times this year.

Technical Indicators

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 6,640.19.

The projected upper bound is: 6,923.54.

The projected lower bound is: 6,669.72.

The projected closing price is: 6,796.63.

Candlesticks

A white body occurred (because prices closed higher 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 33 white candles and 17 black candles for a net of 16 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 59.6214. This is not an overbought or oversold reading. The last signal was a sell 2 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 60.69. 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 94 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 144.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 2 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 up 58.600 at 6,793.700. Volume was 13% below average (neutral) and Bollinger Bands were 45% narrower than normal.

Open High Low Close Volume___
6,735.1006,798.7006,735.1006,793.700 552,234,240

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

Moving Averages: 10-period 50-period 200-period
Close: 6,724.76 6,676.32 6,474.61
Volatility: 11 12 13
Volume: 594,176,384 620,919,680 639,177,344

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 4.9% 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 14 periods. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.

The following two tabs change content below.
HEFFX has become one of Asia’s leading financial services companies with interests in Publishing, Private Equity, Capital Markets, Mining, Retail, Transport and Agriculture that span every continent of the world. Our clearing partners have unprecedented experience in Equities, Options, Forex and Commodities brokering, banking, physical metals dealing, floor brokering and trading.

Latest posts by HEFFX Australia (see all)