Australia: S&P/ASX 200 (.AXJO) shares are poised to open higher

Australia: S&P/ASX 200 (.AXJO) shares are poised to open higher

Australia: S&P/ASX 200 (.AXJO) shares are poised to open higher

It was another day of erratic day of trade in and out of the red on the Australian sharemarket as investors tussled with accelerating domestic house price falls and a slightly “dovish” tilt in the Reserve Bank’s rate outlook.

The news prompted a bearish “inversion” of bond yields out to three years to trade briefly below the official cash rate at 1.50 per cent in a sign investors continued to see domestic growth weakness and rate cuts to one per cent.

The S&P-ASX 200 index opened higher but it twice failed to breach the 6200 point level and after two rallies from the red it closed down 5.7 points, or 0.09 per cent, at 6184.8 with miners the only sector showing much strength.

Government 10-year bond yields dropped 3.9 points to a fresh 30-month low of 1.945 per cent after the Reserve minutes were “more dovish than in February” and the house-price index fell 2.4 per cent over the December-quarter, extending the 1.5 per cent drop reported in the September-quarter.

Overall, the bias in prices is: Upwards.

The projected upper bound is: 6,285.52.

The projected lower bound is: 6,104.15.

The projected closing price is: 6,194.83.

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 30 white candles and 20 black candles for a net of 10 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 62.3984. This is not an overbought or oversold reading. The last signal was a buy 3 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 59.08. 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 7 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 -21. This is not a topping or bottoming area. The last signal was a sell 7 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 7 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -5.700 at 6,184.800. Volume was 17% below average (neutral) and Bollinger Bands were 54% narrower than normal.

Open High Low Close Volume___
6,190.5006,206.3006,174.0006,184.800 525,217,792

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

Moving Averages: 10-period 50-period 200-period
Close: 6,195.96 6,025.90 6,021.05
Volatility: 8 10 14
Volume: 685,385,088 635,149,120 606,724,544

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 2.7% 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 moderate flows of volume into .AXJO (mildly bullish). Our trend forecasting oscillators are currently bullish on .AXJO and have had this outlook for the last 50 periods.

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