XAO Technical Analysis

[Porper]

Re: XAO Analysis

I'm not convinced that we are going to have a great rally from here... ..

I thought yesterday was maybe the start of a run up but today the sellers appeared again.Basically we don't know what we want to do.

Well most counts have us in a wave 3 down still, terminating around 5000 (see chart earlier).I haven't dared project wave 5 yet......................... but it has to be around 4500 ish.

Then pin ya ears back for the next leg up...................maybe.

 

[chops_a_must]

Re: XAO Analysis

I'm not convinced that we are going to have a great rally from here... todays financial sector notwithstanding.... if the Dow/S+P rallied overnight mainly on Buffett then when it really sinks in that he is only offfering to insure the monos top flight gear.. and at a premium of 1.5x what it is currently set at.. then the euphoria may fade as quickly as it arrived...
Also although a lotof the writedowns in US and some of the bigguns in Europe have surfaced.. one country that has a very large financial investment in all things American has been noticably absent at the coming out party.. when, as opposed to if, they make a late appearance, possibly through March, we may have more mayhem to contend with... unless of course in the meantime...
just rambling
.................Mrs Watanabe..

I don't think it was ever going to be that strong a break. Triangle breakouts on downtrends tend to be pretty weak, and faded quickly from a novices observation.

I don't think you can deny the effect that CBA had on the market today though. Really sapped the energy of the bulls. And unless the financials rebound from around here, there is going to be a lot more pain for the whole market I feel. A rebound is possible, given some scratchy support and a fib point. The next support is about 20% away for the financials though. Has been very impotent compared some other areas.

A lot further to go until this all ends for sure.

XFJ chart for those interested. As you can see, the continued breakdown after the lacklustre rebound is a worry. W5 starting on that index for E wavers???:

 

[dhukka]

Re: XAO Analysis

Just on the financials, since the All Ords peaked on November 1st they are all doing worse than the broader market. NAB off -30%, CBA off -25% WBC down -25% and ANZ down -22%

 

[wayneL]

Re: XAO Analysis

Just on the financials, since the All Ords peaked on November 1st they are all doing worse than the broader market. NAB off -30%, CBA off -25% WBC down -25% and ANZ down -22%

Defensives eh? Another fallacy gets credit crunched.

 

[chilliaa]

Re: XAO Analysis

Just on the financials, since the All Ords peaked on November 1st they are all doing worse than the broader market. NAB off -30%, CBA off -25% WBC down -25% and ANZ down -22%

Yes isnt it great, i havent felt so happy in years. Finally value is coming from every angle. I am like a kid in a candy store.

 

[wayneL]

Re: XAO Analysis

Yes isnt it great, i havent felt so happy in years. Finally value is coming from every angle. I am like a kid in a candy store.

chilliaa,

Geniune question: Why do you believe the banks are good value at this point?

 

[numbercruncher]

Re: XAO Analysis

Australia has one of the highest Debt to Income ratios on the planet.

Atleast a Trillion dollars worth, its going to come home to roost sooner or later.

With interest rates skyrocketing many many households wont be able to service this debt.

Inflation is probably the only way out (income, prices etc to play catch up to realestate and debt), be alot of pain along the way though as it all feeds an inflation cycle

I suspect the market believes (amoungst other things) the home to roost is happening sooner than later, hence the banks starting to get spanked

Futures point to 75pc chance of another RBA rise next month

 

[Uncle Festivus]

Re: XAO Analysis

.. one country that has a very large financial investment in all things American has been noticably absent at the coming out party.. when, as opposed to if, they make a late appearance, possibly through March, we may have more mayhem to contend with... unless of course in the meantime...
just rambling
.................Mrs Watanabe..

Kauri... I think Japan will throw a very good party when the time is right - apparently lot's of people will be unexpectantly invited .

Just as battered investors had begun to glimpse signs of recovery in America, the next shoe has dropped with an almighty thud in Japan. Echoes are rumbling across the Far East.

The Tokyo bourse has crumbled, suffering the worst start to the year since the Second World War. The Nikkei index is down 17 per cent since Christmas, and the shares of Japanese banks are leading the slide. Mizuho Financial, Mitsubishi UFJ and Sumitomo Mitsui have all been punished as hard or even harder than those US banks at the epicentre of the sub-prime debacle.

Japan's Nikkei index is down 17pc since Christmas

The nagging fear is that Japan's lenders - the conduit for the world's greatest stash of savings - have taken on a far bigger chunk of mortgage securities, collateralised loans obligations and other exotica from America's structured credit boom than they have yet revealed.

http://www.telegraph.co.uk/money/ma...08/02/10/ccjapan110.xml&CMP=ILC-mostviewedbox

 

[Buffettology]

Re: XAO Analysis

chilliaa,

Geniune question: Why do you believe the banks are good value at this point?

I agree, I havent found one bank that is good value at this point.

 

[wavepicker]

Re: XAO Analysis

I'm not convinced that we are going to have a great rally from here... todays financial sector notwithstanding.... if the Dow/S+P rallied overnight mainly on Buffett then when it really sinks in that he is only offfering to insure the monos top flight gear.. and at a premium of 1.5x what it is currently set at.. then the euphoria may fade as quickly as it arrived...
Also although a lotof the writedowns in US and some of the bigguns in Europe have surfaced.. one country that has a very large financial investment in all things American has been noticably absent at the coming out party.. when, as opposed to if, they make a late appearance, possibly through March, we may have more mayhem to contend with... unless of course in the meantime...
just rambling
.................Mrs Watanabe..

Other worldwide bourses are rallying as expected. Did Aussie market put in a pivot on Monday as was the expectation from the analysis I posted?? Will bank fallout continue to send our market lower?
My opinion is the worst is over for the time being. Not expecting our market to blast off from here, but at least trend cautiously sideways to upward until all the negativity is washed out.

Some of the banks(not all) appear as if they were completing or are still in fifth waves yesterday. Among them CBA. If it has not completed that 5th wave then it would have to be only a few days away. This does not mean their bear market is over though but at least a rally as short as it may be could be in the making soon.

Cheers

 

[Sean K]

Re: XAO Analysis

chilliaa,

Geniune question: Why do you believe the banks are good value at this point?

I agree that falling off highs does not indicate value, but must make them bettervalue at least. I'm watching those banks with interest. Been smashed, maybe deservedly, but when they become 'good value' is the question. Rumours an Australian bank is going to report sub prime losses this am won't put a floor under these blood sucking fee monsters.

0828 [Dow Jones] AUD/USD sharply lower overnight on rumors that an Australian bank is facing losses on subprime mortgages, according to Westpac FX strategy. Speculation in markets partly accounted for slide from 0.9040 to lows around 0.8940. AUD/USD was the main underperformer among the major currencies. AUD/USD now 0.8965. (JEG)

Is this XAO Analysis? Sorry.

 

[korrupt_1]

Re: XAO Analysis

Just looking at the last 2 weeks action...

Seems that a decending triangle is forming... lower highs... (although not a perfect decending trangle as the lows are also higher too)

A break of 5750 might be a signal for higher prices...

A break below 5500 could be very very bad indeed... It seems that 5520-5540 has seen some VERY STRONG support so far.

I just wish I was game enough to trade these levels... the market is bonkers and needs to be hospitalised for mental problems...:bonk:

 

[chilliaa]

Re: XAO Analysis

chilliaa,

Geniune question: Why do you believe the banks are good value at this point?

The time to start sniffing around is when everyone else is distressed. I still dont like CBA as had a faster rise last year and is thus more highly priced than the other banks. But ANZ and NAB are are BEGINING to look ok. (Still prefer ANZ though cause of better consistency in their earnings).

I am not saying bet the house at this stage, but start to nibble, i am also refering to the financial sector in general.
The only sector i am avoiding is the resource and resource linked contractor stocks. This will probably hammer my short term performance, but in the long term i feel alot more comfortable.

 

[Buffettology]

Re: XAO Analysis

Just looking at the last 2 weeks action...

Seems that a decending triangle is forming... lower highs... (although not a perfect decending trangle as the lows are also higher too)

A break of 5750 might be a signal for higher prices...

A break below 5500 could be very very bad indeed... It seems that 5520-5540 has seen some VERY STRONG support so far.

I just wish I was game enough to trade these levels... the market is bonkers and needs to be hospitalised for mental problems...:bonk:

Korrupt, with your chart, after its first low, it doesnt rally to form a high above the following highs, wouldnt this indicate it is NOT a descending triangle? Though I do note that the chart is over a VERY small timeframe.

Furthermore, wouldnt resistance be just above 5700 (as opposed to above 5750?).

Chilliaa, why are you avoiding the resources boom? It appears fundamentally, reasonably safe. Its not like the tech boom where you have absolutely rediculous prices based upon absolutely no fundamentals but simply a belief that e-commerce is the "way of business in the future".

Cheers

 

[chilliaa]

Re: XAO Analysis

I agree, I havent found one bank that is good value at this point.

To be honest I cant make a really strong BUY case at the moment. Because I think provisioning as been under accounted for the last 5+yrs. The other issue is historical shrink in margins (even before this credit crisis stuff happened, refer to the banks 2007 annual reports and you will see what I mean).

At the end of the day, you have to make a 'bet' (I hate using that word), on where you see the Australian economy in several years down the track. If we have a 'soft patch', I think the banks will pull through. However if the economic climate gets rough then their stock has much further to go.

For myself I dont know the answer to that, so I bought ANZ earlier this year at about $26 which represented around 3% of my portfolio. Obviously the current price is lower, I am not buying more because of the risks mentioned above, but at the same time I am selling.

I have been recently buying other financial related stocks: MQG, BNB AMP and CPU during the recent turmoil.

If ASX can get down to around $35 I will start to pick that one up as well.

 

[chilliaa]

Re: XAO Analysis

TTo be honest I cant make a really strong BUY case at the moment. Because I think provisioning as been under accounted for the last 5+yrs. The other issue is historical shrink in margins (even before this credit crisis stuff happened, refer to the banks 2007 annual reports and you will see what I mean).

At the end of the day, you have to make a 'bet' (I hate using that word), on where you see the Australian economy in several years down the track. If we have a 'soft patch', I think the banks will pull through. However if the economic climate gets rough then their stock has much further to go.

For myself I dont know the answer to that, so I bought ANZ earlier this year at about $26 which represented around 3% of my portfolio. Obviously the current price is lower, I am not buying more because of the risks mentioned above, but at the same time I am selling.

I have been recently buying other financial related stocks: MQG, BNB AMP and CPU during the recent turmoil.

If ASX can get down to around $35 I will start to pick that one up as well.

Sorry in reference to ANZ should have said also NOT selling.

 

[Whiskers]

Re: XAO Analysis

The market will struggle sideways for a few weeks before blowing off to the 6243pt level(which is the 0.618 retrace level) before heading south again. My target date for this high is 10 or11th of March. The price level is based of the confluence of 3 things:

• Retrace of price from top to bottom
• Assuming we get a contracting triangle pattern blue wave b forming
the thrust upward will be the approximate height of the triangle.
• The squaring of both price and time

Struggle is the operative word alright, but I'm still happy with that projection.

Started week on a downer, probably on (allegations of) fundies doing a bit of manipulation, but after that it got higher highs and higher lows again and consequently gave the down trend line a nudge but hasn't broken through yet. Might have the effect of extending the up kick a bit.

With more news of market intervention here and abroad, to regulate the maverick institutions who fail to abide by conventional protocols and push the envelope, I think it will continue to have a steading effect minimising market downside, ie strongly doubt massive sell offs a-la 87 etc.

The weekly candle close has been still been above the 100% fib. Probably the most significant indicator this week is a likely crossover under the ADX suggesting continued subdued momentum generally sideways to up.

To me the P&F chart is still a little bullish. Interested to see motorways estimation and B%.

US holiday monday. We might go positive this time although the daily moves are a bit of doing the opposite to what you think the opposite of what you expect.

 

[motorway]

Re: XAO Analysis

Interested to see motorways estimation and B%.

I will post more commentary on this later

But I will put these charts up now

There is only

. Price ---The range of each move ( wave of buying and selling )
. Volume----The quantity traded
. Time-------As in the sense of duration--- how long

and in the context of Positon

. Position

OK ???

each wave of buying and selling has a certain, price range, volume and duration.... and a certain position...

Position is Prospect

There four things make up what Richard Wyckoff called the "four qualities"

and what reveals is the "character of the behavior" of these four qualities

convergent/divergent but also inharmonious and harmonious...

In context............Position is Prospect...


hence there is the trend and also the position in the trend.

the B% is a bottom up ( inductive ) map of position
it cycles between overbought and oversold

However we need the other three "qualities" to confirm that oversold is oversold...........

P&F is also a chart of positions..... on one axis is the price continuation ( trend ) on the other is price reversal ( risk )

P,V,T & Position... have various attributes



A 3 box reversal P&F I assume we have all seen .... The columns are drawn
by demand and supply... in this method of P&F the top of a rising column is the last point of supply ( the last point of resistance ) the bottom of a falling column is the last point of demand ( the last point of support )

because it unfolds in it's own time ( hint time is only another name for motion ) it is non linear and adaptive....eg The Points of resistance are moving higher and lower as demand and supply curves shift and rotate ..



So what is called a double top buy signal is simply prices moving past the "last point of supply" ( it need not be a buy signal )

The B% charts every stock on the ASX as a 2% x 3 P&F and then charts the number as a percent that are above "the last point of supply"

So it is a calendar of "Position" ( With a good calendar, compass and map ? )

and Position in context is Prospect

so some charts.

B% and volume as a line chart

P&F as a 1.25% x 1 with some 45 degree trend lines ( reduced to see the whole cycle )

P&F again but just looking at the current action

( P&F and the bar charts will move at different speeds )...

"Secondary tops and bottoms"

on the way up above and then below the 45 degree trend
on the way down below and then above the 45 degree trend

B% is moving higher ( even though the index moved lower )

The 1 box P&F has narrowed ( demand and supply curves closer together)

The shape of the pattern from the bottom is strong ( called a recoil )

P&F also reveals harmony ( or lack ) between range and trend ( eg the count )

there is only P,V,T & Postion . You can either use them as tools for judgement
indications or as mechanical indicators ( even charts can used as indicators )

The blue lines on the P&F are measuring the thrust of the waves...
( They and the move to horizontal )

motorway

 

[Sean K]

Re: XAO Analysis

I will post more commentary on this later

So what's it telling us motorway? We're trending down?

 

[nizar]

Re: XAO Analysis

So what's it telling us motorway? We're trending down?

LOL I dunno about you bro, but motorways posts above just went way above my head...

Can anybody offer an english translation?