Australia: S&P/ASX 200 (.AXJO) Slip as New U.S. Tariffs Loom

Australia: S&P/ASX 200 (.AXJO) Slip as New U.S. Tariffs Loom

Australia: S&P/ASX 200 (.AXJO) Slip as New U.S. Tariffs Loom

Australian shares fell early last week, with banking stocks leading losses, as investors waited to see if Washington will proceed with new tariffs on China that could change the course of their months-long trade war.

The S&P/ASX 200 index snapped a three-session rally to end 0.3 percent, or 23.1 points, lower at 6,706.9 on December 10.

Markets are in a wait-and-see mode as they await headlines from Washington or Beijing, said James Tao, market analyst at CommSec.

U.S. President Donald Trump has until December 15 to decide whether Washington will press pause on fresh tariffs that are scheduled to take effect against $156 billion worth of Chinese goods.

Heavyweight bank units lent most to the benchmark’s losses, with the country’s third-largest lender National Australia Bank giving up 1.5 percent.

Brokerage Morgan Stanley cut NAB’s price target on expectations of further capital raising and another dividend cut in fiscal 2020.

Wealth manager IOOF Holdings bucked sectoral trend to end 0.6 percent higher after Australia’s banking regulator said it would allow IOOF to hold controlling stakes in superannuation licenses currently owned by ANZ.

IOOF shares had risen as much as 5.8 percent during the session before giving up some gains.

Iron ore miners were among the few gainers as prices of the steel-making ingredient rose to their highest in more than four months on supply uncertainties expected to emerge during the first quarter of next year.

The mining index added 0.6 percent, with miners BHP Group, Rio Tinto and Fortescue Metals Group finishing between 1.1 percent and 1.3 percent higher.

Oil and gas producers were also in the red, pressured by oil prices slipping for a second straight session. Santos fell 1.3 percent, while bigger peer Woodside Petroleum ticked 0.8 percent lower.

New Zealand’s benchmark S&P/NZX 50 index added 0.5 percent, or 54.63 points, to 11,284.22.

Ryman Healthcare gained the most, rising 3 percent to end at a record high.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 7,000.65.

The projected lower bound is: 6,704.10.

The projected closing price is: 6,852.38.

Candlesticks

A black body occurred (because prices closed lower 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 32 white candles and 18 black candles for a net of 14 white candles.

A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).

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 86.0946. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 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 58.43. 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 116 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 93. This is not a topping or bottoming area. The last signal was a buy 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 buy 1 period(s) ago.

Rex Takasugi – TD Profile

S&P/ASX 200 closed down -2.400 at 6,847.300. Volume was 1% below average (neutral) and Bollinger Bands were 3% wider than normal.

Open     High      Low     Close     Volume___
6,849.7006,871.3006,839.1006,847.300 631,592,576
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 6,733.15 6,718.48 6,544.90
Volatility: 17 14 14
Volume: 600,585,344 594,838,976 629,768,832

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 4.6% above its 200-period moving average and is in an upward trend. Volatility is high 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 0 periods.

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