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XAO Technical Analysis

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Re: XAO Analysis

korrupt_1 said:
:banghead: :banghead: :banghead: :banghead: :banghead: <-- this is how I feel about the SPI ATM...

Sorry for a completely useless posting... but I am really really !@#$%^&** with these wild 100+ point swings.. I mean what has FUNDAMENTALLY CHANGED?
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ha ha ha ha ha, I feel you bro! Its starting to get to me also lately!

Infact, I am going on a holiday in about 5 minuets and will not be able to check the net for a few days.

Hopefully I can keep to that habit and just ride it out from here-on in. It starts to eat at you after a while, so much time and effort researching and selecting stocks, only to have the index turn on you and end up down either way!

FundaMENTALS have well and truly gone out the window lately! With all this credit crunch (stagflation) fear, and it is a very real fear, sentiment is driving the market! Hard to even determine fundamentals in relation to individiual stocks ATM as future growth forecasts mean close to NOTHING!
 
Re: XAO Analysis

Struggling to break through the downtrend line, and the consolidation along 5600-ish is running out of room, so one has to give very soon.

GP
 

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Re: XAO Analysis

korrupt_1 said:
:banghead: this is how I feel about the SPI ATM...

Sorry for a completely useless posting... but I am really really !@#$%^&** with these wild 100+ point swings.. I mean what has FUNDAMENTALLY CHANGED?
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Whats the matter|?|???
Since when did short term movements have any impact on fundametal analysis. Either you are a trader or an investor. But if you are an investor thinking like a trader you are going to get hammered:eek:

For fundamental investors this market is absolutely fabulous:D
Hehe the main purpose of a correction is to move assets back to their rightful owners:D:D
 
Re: XAO Analysis

chops_a_must said:
Makes a lot of sense to me WP.

I thought we may have tested those previous lows at ~6200 on the sharp move up, but it didn't happen.

6244 is near enough to the 61.8 retrace I have of the total move down thus far. ~6150 is the 61.8 retrace of the "mug" count that I have. An ABC move from this correction would also get it close enough to these areas to be valid.

Any break down and I would favour the high 4700s personally.

But... I am net long... just playing individual stocks on their merits... so maybe there is something in that. A lot of key stocks on support, or near enough to, that I can't see a reason for them to go through. Either way, I'm prepared, as hopefully all are.

But thanks heaps for the detailed revisit, it is much appreciated.

Cheers,
Chops.
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I am net long as well chops, have been so since early this week. I know it's quite frustrating at present but have to hang in there. In actual fact it's actually quite good RR setup, with a stop marginally below the previous low of the sideways move. The XAO pattern is actaully quite skewed at this juncture due in part from the bank weakness. The US Indices give a much clearer picture IMO with some good EW contracting triangles in the cash market data see below both in the DJIA and SP500. They look like they will resolve within the next 2 sessions. Triangles form because the market is waiting for something to give it direction, usually associated with news. Perhaps as josjes mentioned, the fed may come out with something to give the markets some stimulus coming into the next meeting. Not sure could be anything!! That's why the best things to work with are the patterns.

Still favour the a move north to complete the pattern before heading south again. This is a classic countertrend move and positioning correctly in the countertrend move completion is the best place to make $$. (assuming I am right about the wavecount that is!!)To me the termination of the countertrend for a position on the short side is more important than the upward "thrust" that precedes it, even though that in itself will be quite tradeable
 

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Re: XAO Analysis

Hi All,

Has anyone noticed that the XMJ not only established a higher low but is also about to rise above the lower high it set up before the downturn in january.

Does the bullishness in this index say anything about where the XAO may head?

Cheers to all - :)
 
Re: XAO Analysis

nikki said:
Hi All,

Has anyone noticed that the XMJ not only established a higher low but is also about to rise above the lower high it set up before the downturn in january.

Does the bullishness in this index say anything about where the XAO may head?

Cheers to all - :)
Click to expand...

The biggest sector in the XAO is still the XFJ. BHPs (& a few others)run last year masked the weakness in the XJO. Most stocks had stopped going up after the April 07, then went nowhere to down.

Its the banks/Fins that move the XAO/XJO. The XMJ lead higher into the end of December last year. And look where we are. We really need a broad rally in the Financials to move the XAO. With them having been hammered lately the chances of a snap back are on the cards. Its probably the test after that that will count for the rest of the year.
 
Re: XAO Analysis

wavepicker said:
I am net long as well chops, have been so since early this week. I know it's quite frustrating at present but have to hang in there. In actual fact it's actually quite good RR setup, with a stop marginally below the previous low of the sideways move.

Still favour the a move north to complete the pattern before heading south again. This is a classic countertrend move and positioning correctly in the countertrend move completion is the best place to make $$. (assuming I am right about the wavecount that is!!)To me the termination of the countertrend for a position on the short side is more important than the upward "thrust" that precedes it, even though that in itself will be quite tradeable
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Yah. Like I said previously, there are a lot of key stocks sitting on support or so it looks. Just going through the charts again today, a lot look like potentially breaking out, rather than down. So the common sense approach is to buy them, with stops below the support, and reverse if it does break. That gives the best r/r, which is what is key to your strategy in the extreme, I've noticed.

I don't trade indices on anything other than intraday timeframe, but my individual stock bias is influenced by the indices.

Agree with TH though. Materials, mining and a few others are giving bull signals, financials need to do something to move the market though. And even if they do, I still wouldn't go long them. In fact a lot of the materials look really incredibly and relatively strong, and just need a kick I feel. The financials may give that kick.

Will probably be waiting for ex-div time on the majority of these financials to get very short. Unless the market breaks down, in which case you'd be twisting my rubber arm to get short...

Cheers.
 
Re: XAO Analysis

Hi Chops_a_must, what are some of the stocks you talk about in your note. Just interested in studying them to see what you mean?

Cheers.
 
Re: XAO Analysis

another choppy ride today... still the upper resistance at around 5700 (XJO) is still impeding higher prices. One can hope (if you are long) that the massive gap made yesterday would be a nice support zone if the US does go through some profit-taking tonight...

also,... i'm starting to take the bull out of the cupboard now and let him run free.... have been noticing that the bad news lately hasn't really cause much more mayhem on the SPI...

A few weeks ago, it was a case of "ALL NEWS was bad news"... now, it's "BAD NEWS - isn't really that bad" anymore and "GOOD NEWS is actually good news?!!" Hey hey.... are we back to the gold old times of a bull market for the time being??
 
Re: XAO Analysis

korrupt_1 said:
another choppy ride today... still the upper resistance at around 5700 (XJO) is still impeding higher prices. One can hope (if you are long) that the massive gap made yesterday would be a nice support zone if the US does go through some profit-taking tonight...

also,... i'm starting to take the bull out of the cupboard now and let him run free.... have been noticing that the bad news lately hasn't really cause much more mayhem on the SPI...

A few weeks ago, it was a case of "ALL NEWS was bad news"... now, it's "BAD NEWS - isn't really that bad" anymore and "GOOD NEWS is actually good news?!!" Hey hey.... are we back to the gold old times of a bull market for the time being??
Click to expand...

hehe... I wish! I think there is more price manipulation going on at the moment more than anything.... I find it all amusing that everytime in the US the index is about to snap, some breaking news comes through (as we have seen on Friday and Monday)... someone is definately pulling some strings, one big bubble building up if you ask me:)
 
Re: XAO Analysis

Thought I'd share this 'hot tip'.... heard from someone that a (large) investment firm have some options that for them to be in the money, it will need to be >5800 (xjo) by expiry of options trading tomorrow...

Another something to mull over while you watch the SPI gets 'manipulated' and 'massaged' to some grand scheme that only the rich and powerful are privy too... :cautious:
 
Re: XAO Analysis

korrupt_1 said:
Thought I'd share this 'hot tip'.... heard from someone that a (large) investment firm have some options that for them to be in the money, it will need to be >5800 (xjo) by expiry of options trading tomorrow...

Another something to mull over while you watch the SPI gets 'manipulated' and 'massaged' to some grand scheme that only the rich and powerful are privy too... :cautious:
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hey korrupt,
Can you elaborate further as to what this may mean for the general market?
If they sell in the money what may happen?
:)
 
Re: XAO Analysis

I don't fully understand option trading, but in general, for their options trade to be profitable, they need to have the XJO >5800 by expiry. It's like a binary bet that it will be +5800... if so, they make money, if not, they lose...

However, this is the twist... since they are a large investment firm (an overseas bank),... they can and will (if they can) manipulate the market to make sure that it does hit their target...

It's either that or their option trade is a hedge of some sort?

Another thing is, from what this person told me, this option trade was performed about 2 weeks ago when the XJO was around the the 8500's
 
Re: XAO Analysis

korrupt_1 said:
However, this is the twist... since they are a large investment firm (an overseas bank),... they can and will (if they can) manipulate the market to make sure that it does hit their target...
Click to expand...

One of the many problems with such theories is that there is someone else just as big on the other side of such trades if it exist.
 
Re: XAO Analysis

korrupt_1 said:
Thought I'd share this 'hot tip'.... heard from someone that a (large) investment firm have some options that for them to be in the money, it will need to be >5800 (xjo) by expiry of options trading tomorrow...

Another something to mull over while you watch the SPI gets 'manipulated' and 'massaged' to some grand scheme that only the rich and powerful are privy too... :cautious:
Click to expand...

Well their options are still not ITM. Would be if they were trading the all ords but they are trading the S&P200 right. Plus depending on the premium they payed, it will have to hit above 5800 for them to breakeven and doubt a large investment firm would buy way OTM options in any kind of large quantity (so their premiums would probably be a decent amount), unless they had some HUGE news...........or wanted to play with their investors.........infact, I would think they would only buy large quantities of calls in a market like this if they were DITM. Then again, I do not work in an options trading area of a firm.

Might well be some profit taking tomorrow, heck I know I made a handy 4% today overall, incredible! That covers a couple weeks trading right there!

But I do agree with the above posts, sentiment appears to be changing. Bad news seems factored in already, so we might well see the bulls gain some power over the next little while.
 
Re: XAO Analysis

String of news out in the US Wednesday, probably all bad, Ben goes to Capitol hill and the USD hit an all time Low ....

Probably all a good mix for Red, so korrupts tip may end up in the money ! No use for looking for rationality out there It seems, just gotta trade with the sentiment I guess !~

:eek:
 
Re: XAO Analysis

korrupt_1 said:
I don't fully understand option trading, but in general, for their options trade to be profitable, they need to have the XJO >5800 by expiry. It's like a binary bet that it will be +5800... if so, they make money, if not, they lose...

However, this is the twist... since they are a large investment firm (an overseas bank),... they can and will (if they can) manipulate the market to make sure that it does hit their target...

It's either that or their option trade is a hedge of some sort?

Another thing is, from what this person told me, this option trade was performed about 2 weeks ago when the XJO was around the the 8500's
Click to expand...

korrupt. I think this is just crap. February XJO & SPI options expired last Thursday(21st) not toda. There was not any unusual volume. today single stock futures expire and I don't see an large options trade over all 200 stocks being placed that would make you "Hot Tip" of over 5800 logical. This kind of stuff needs to be backed up with some evidence or I think its ramping. As the options have been taken out 1 week ago what you have stated looks WRONG. please provide some evidence of such hot tips or leave them out of a good thread.
 
Re: XAO Analysis

Following on from the analysis of the XAO was posted -090208

https://www.aussiestockforums.com/forums/showpost.php?p=258027&postcount=2842

https://www.aussiestockforums.com/forums/showpost.php?p=258028&postcount=2843

The following EW chart was shown with the expected pattern of trend shown by the arrows. The target was 6244pts and the date 11th March as the preferred time cycle count and 21st march as the alternate.

So far the pattern of trend has traced out as expected and pink wave b of the contracting triangle has completed and pink wave c is currently in progress. These usually retrace 50-61% of wave c. Not much else has changed, this is a countertrend rally and should be fully retraced when it is complete and I expect market to continue on to fresh lows.

The SP500 has also a similar pattern of trend

Cheers
 

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