XAO Technical Analysis
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Re: XAO Analysis
I'm no expert on charts or analysis of any sort really.........but I do think the last correction was a little light on (not that I'm complaining).
One thing I have noticed though is my WBC (Westpac) shares have jumped a dollar in 6 trading days.........now this is telling me that people are jumping back into banks.
Am I imagining things.......maybe........but I think there is a real sense of nervousness out there.
MB
I'm no expert on charts or analysis of any sort really.........but I do think the last correction was a little light on (not that I'm complaining).
One thing I have noticed though is my WBC (Westpac) shares have jumped a dollar in 6 trading days.........now this is telling me that people are jumping back into banks.
Am I imagining things.......maybe........but I think there is a real sense of nervousness out there.
MB
Sean K
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Re: XAO Analysis
If you're a long term investor, then you'd either have the 'I don't care about short term movements' attitude, or perhaps 'bring it on, it will be a great buying opportunity'.....
Yep, DOW having a great run and at all time high I think. I agree with the spacing point, however I don't think the last correction was deep enough and therefore the next one could possibly come on a little sooner. Perhaps I'm being overly cautious? Paranoid even?Kennas.
Notice how it was only 2 months ago when we had the last correction (not even). Other corrections are more widely spaced ie. several months.
DOW up by 140pts at the minute
If you're a long term investor, then you'd either have the 'I don't care about short term movements' attitude, or perhaps 'bring it on, it will be a great buying opportunity'.....
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Re: XAO Analysis
Kennas
I don't think you are being paranoid here.....
The ASX S&P 200 on Wednesday reached the furthest % gap it has been from it's 200 SMA since inception. As of Friday, it is 14.03% off the 200 day moving average.... It's now at twice the standard deviation from the average. If the Dow is anything to go by (and obviously they are not direct related however it is interesting to note), in 10 years the Dow from peak to trough in each wave has only gone above 15% twice, both times only lasted less than 1.5 months and every single time at the peak they lost < 15% every time.
Add to that we are only 7 trading days off May.....
I'm not saying we will crash, but the parabolic trend of late is a little concerning.
In saying that, if people want to squeeze out a little more, go ahead. But statistically, it doesn't bode well.......
Cheers
Yep, DOW having a great run and at all time high I think. I agree with the spacing point, however I don't think the last correction was deep enough and therefore the next one could possibly come on a little sooner. Perhaps I'm being overly cautious? Paranoid even?
If you're a long term investor, then you'd either have the 'I don't care about short term movements' attitude, or perhaps 'bring it on, it will be a great buying opportunity'.....
Kennas
I don't think you are being paranoid here.....
The ASX S&P 200 on Wednesday reached the furthest % gap it has been from it's 200 SMA since inception. As of Friday, it is 14.03% off the 200 day moving average.... It's now at twice the standard deviation from the average. If the Dow is anything to go by (and obviously they are not direct related however it is interesting to note), in 10 years the Dow from peak to trough in each wave has only gone above 15% twice, both times only lasted less than 1.5 months and every single time at the peak they lost < 15% every time.
Add to that we are only 7 trading days off May.....
I'm not saying we will crash, but the parabolic trend of late is a little concerning.
In saying that, if people want to squeeze out a little more, go ahead. But statistically, it doesn't bode well.......
Cheers
CanOz
Home runs feel good, but base hits pay bills!
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Re: XAO Analysis
Hmmm, slightly off topic question Reese, but i'm just curous...Do you use both FA and TA, i see you some reference to both in your posts?
I'm still waiting for a selling climax to be noted in the volume of the indices....i haven't seen it happen yet, but every decent correction is preceded by a large increase in volume and little upside gained, usually a few days before the buyers disappear altogether.
Any thoughts on this?
Hmmm, slightly off topic question Reese, but i'm just curous...Do you use both FA and TA, i see you some reference to both in your posts?
I'm still waiting for a selling climax to be noted in the volume of the indices....i haven't seen it happen yet, but every decent correction is preceded by a large increase in volume and little upside gained, usually a few days before the buyers disappear altogether.
Any thoughts on this?
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Re: XAO Analysis
At the risk of wearing out my welcome, I'm going to post my 1987 comparison chart once more, as I think the resemblance is getting stronger... I've been saying for a while I thought we would see a short sharp correction followed by a period of euphoric buying then a crash... below is the chart that makes me think that this is a possibility.
Nothing is ever exact, but I think when we start to think about 20 year cycles, and look at the similarities (and there are some noticable differences too) then it isn't outside the realms of possibility.
Something that Alan Koher said on the finance section of ABC news a month or so ago, to me seems like the catalyst for the euphoric buying (he recently mentioned this again in Eureka report, though this time he called it panic buying). That catalyst was the huge amount of money that will become available for investment when ordinary holders have their shares bought out in private equity deals, ie coles and qantas... He bandies about figures of $50 billion looking for a new home!! that sort of buying demand is sure to send prices up, but the demand will eventually run out, and shares will be at much higher P/E levels... this (combined with leveraged money) will I think be what triggers the crash, with panic setting in and prices dropping far below what is reasonable as an over-reaction. However I don't see this crash happening in the short term... if this does happen we will need to see the XAO go to I'd say well over 7000 before the end of the year...
Alan Kohers advice (from memory) was to ride it up and sell into the stupidity!
Tony.
At the risk of wearing out my welcome, I'm going to post my 1987 comparison chart once more, as I think the resemblance is getting stronger... I've been saying for a while I thought we would see a short sharp correction followed by a period of euphoric buying then a crash... below is the chart that makes me think that this is a possibility.
Nothing is ever exact, but I think when we start to think about 20 year cycles, and look at the similarities (and there are some noticable differences too) then it isn't outside the realms of possibility.
Something that Alan Koher said on the finance section of ABC news a month or so ago, to me seems like the catalyst for the euphoric buying (he recently mentioned this again in Eureka report, though this time he called it panic buying). That catalyst was the huge amount of money that will become available for investment when ordinary holders have their shares bought out in private equity deals, ie coles and qantas... He bandies about figures of $50 billion looking for a new home!! that sort of buying demand is sure to send prices up, but the demand will eventually run out, and shares will be at much higher P/E levels... this (combined with leveraged money) will I think be what triggers the crash, with panic setting in and prices dropping far below what is reasonable as an over-reaction. However I don't see this crash happening in the short term... if this does happen we will need to see the XAO go to I'd say well over 7000 before the end of the year...
Alan Kohers advice (from memory) was to ride it up and sell into the stupidity!
Tony.
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Re: XAO Analysis
Hey can aussieuck, I use T/A to trade markets - F/A has a distinct time lag and being a young and impatient person, it just doesn't suit me to trade on this basis. If you were a patient, long term investor, it could work for you. Plus, I am an accountant by trade, so I have severe bias because I can see the loopholes Companies use when preparing reports. In saying that however, I love analysis of Companies from a F/A point of view, because its study is extremely interesting. So, it's always fun to comment on F/A IMO and I try to add value to the F/A investors where I can.....
I do agree with you in regards to the selling climax - we are not quite there yet. We haven't seen those tight ranges with heavy volume yet. But I think that statistical evidence suggests we are very close to this waves top. So, from my point of view, if you were trading the SPI or index or were highly leveraged, I would want tight stops and wouldn't be holding positions overnight on index positions. Sure, you are going to give some money away on the spread, but from my perspective, risk/reward says be careful at the moment. Be happy for anyone to challenge me on this however!
Cheers
Hey can aussieuck, I use T/A to trade markets - F/A has a distinct time lag and being a young and impatient person, it just doesn't suit me to trade on this basis. If you were a patient, long term investor, it could work for you. Plus, I am an accountant by trade, so I have severe bias because I can see the loopholes Companies use when preparing reports. In saying that however, I love analysis of Companies from a F/A point of view, because its study is extremely interesting. So, it's always fun to comment on F/A IMO and I try to add value to the F/A investors where I can.....
I do agree with you in regards to the selling climax - we are not quite there yet. We haven't seen those tight ranges with heavy volume yet. But I think that statistical evidence suggests we are very close to this waves top. So, from my point of view, if you were trading the SPI or index or were highly leveraged, I would want tight stops and wouldn't be holding positions overnight on index positions. Sure, you are going to give some money away on the spread, but from my perspective, risk/reward says be careful at the moment. Be happy for anyone to challenge me on this however!
Cheers
Sean K
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Re: XAO Analysis
Hi Tony. That RSI is looking untidy isn't it. I hope a correction comes sooner rather than later to keep the market healthy for just a bit longer. Until I master shorts!At the risk of wearing out my welcome.........
Alan Kohers advice (from memory) was to ride it up and sell into the stupidity!
Tony.
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Re: XAO Analysis
Tony
Whilst I believe the market is overbought, the comparison to the 87 crash statistically isn't there......
I wish I had it with me, but Tricom have actually transposed the lead up to the 87 crash over todays market. If this were the case, we would have a rise to about 12 K until April 08 and a fall of 6000 points in a couple of months after that.....
It really gives you an idea of how hot those 80's were..... I will post it on Monday to give you look, because it is very interesting.....
Cheers
At the risk of wearing out my welcome, I'm going to post my 1987 comparison chart once more, as I think the resemblance is getting stronger... I've been saying for a while I thought we would see a short sharp correction followed by a period of euphoric buying then a crash... below is the chart that makes me think that this is a possibility.
Nothing is ever exact, but I think when we start to think about 20 year cycles, and look at the similarities (and there are some noticable differences too) then it isn't outside the realms of possibility.
Something that Alan Koher said on the finance section of ABC news a month or so ago, to me seems like the catalyst for the euphoric buying (he recently mentioned this again in Eureka report, though this time he called it panic buying). That catalyst was the huge amount of money that will become available for investment when ordinary holders have their shares bought out in private equity deals, ie coles and qantas... He bandies about figures of $50 billion looking for a new home!! that sort of buying demand is sure to send prices up, but the demand will eventually run out, and shares will be at much higher P/E levels... this (combined with leveraged money) will I think be what triggers the crash, with panic setting in and prices dropping far below what is reasonable as an over-reaction. However I don't see this crash happening in the short term... if this does happen we will need to see the XAO go to I'd say well over 7000 before the end of the year...
Alan Kohers advice (from memory) was to ride it up and sell into the stupidity!
Tony.
Tony
Whilst I believe the market is overbought, the comparison to the 87 crash statistically isn't there......
I wish I had it with me, but Tricom have actually transposed the lead up to the 87 crash over todays market. If this were the case, we would have a rise to about 12 K until April 08 and a fall of 6000 points in a couple of months after that.....
It really gives you an idea of how hot those 80's were..... I will post it on Monday to give you look, because it is very interesting.....
Cheers
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Re: XAO Analysis
Thanks Reece, I was looking at how much it rose (basically doubled in two years!!) so it would have to be pretty damn spectacular to match that, but we might have a mini version, if it doesn't correct again soon??
Tony.
Thanks Reece, I was looking at how much it rose (basically doubled in two years!!) so it would have to be pretty damn spectacular to match that, but we might have a mini version, if it doesn't correct again soon??
Tony.
chops_a_must
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Re: XAO Analysis
Read the data thread as to why this comparison is pointless and useless.
Read the data thread as to why this comparison is pointless and useless.
Sean K
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Re: XAO Analysis
Bit of resistance developed there at 6200 ish. MACD starting to fall over (Ooo), bearish Stochastics going through 50 (untidy), RSI not extended on the 6 month chart, and is now under 80 on the 3 year weekly (OK). DMI/ADX still strong, not on this chart (Good). Slightly conflicting signals....
Bit of resistance developed there at 6200 ish. MACD starting to fall over (Ooo), bearish Stochastics going through 50 (untidy), RSI not extended on the 6 month chart, and is now under 80 on the 3 year weekly (OK). DMI/ADX still strong, not on this chart (Good). Slightly conflicting signals....
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chops_a_must
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Re: XAO Analysis
Looks like an ascending triangle forming to me Kennas...
Looks like an ascending triangle forming to me Kennas...
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Re: XAO Analysis
Release of mild CPI data putting the case for further rate rises on hold temporarily
Release of mild CPI data putting the case for further rate rises on hold temporarily
Re: XAO Analysis
hi chops
I would have to agree . That is a nice looking chart . If it was a share you would certianly have it in your watch list .
I have tried to trade it intraday for the last few days and haven't had much luck but my longer term hold is going well .
I would be looking to take another position when the numbers go above 6250. The index had to have a rest of some sorts and looks like it is .
O well nice to see and we'll all be keeping a close eye for he breakout
Cheers Martin
hi chops
I would have to agree . That is a nice looking chart . If it was a share you would certianly have it in your watch list .
I have tried to trade it intraday for the last few days and haven't had much luck but my longer term hold is going well .
I would be looking to take another position when the numbers go above 6250. The index had to have a rest of some sorts and looks like it is .
O well nice to see and we'll all be keeping a close eye for he breakout
Cheers Martin
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Re: XAO Analysis
An interesting article ..
The ASX is getting over bought short term and the most likely course for the next few weeks to a couple of months is – correction mode. Traders may be lucky and get a chance to sell into this market this week and wait for buying opportunities over the coming weeks, some will be even luckier and pick some of the winners that are set to go against the tide. A look at the Resources Bourse for my offshore friends…
The ASX has now risen sharply by about 10% and you will note the short term peaks above – in November, start of January, end February and now potentially… where this market has gotten overheated and needed a pause. This combined with seasonal factors seems to suggest traders should tread warily and investors should apply caution right about now. We do not see a long protracted decline, Down Under we are in a long term resources boom and the ASX is overweight resource stocks compared to other international indices.
Further to this comment - there are some stocks, particularly in gold and base metals that are poised for a run, even right now. Uranium stocks in my PDF product have very attractive charts, the stuff of dreams and investors have been cleaning up and many of these stocks now need a pause. We are about to find out what the potential new Labor Government intends to do with their Uranium Mining Policy so all breaths are now held in check awaiting the outcome next weekend. I daren’t guess at the outcome as advice or even opinion – however I can say noises from the moderates indicate that common sense must prevail. I’ll just wait and see, including the reaction of many of the overheated uranium stocks. The market is expecting a pro-uranium mining result. There may be some “live cat” bounces on any meaningful pull backs in the near term.
An interesting article ..
The ASX is getting over bought short term and the most likely course for the next few weeks to a couple of months is – correction mode. Traders may be lucky and get a chance to sell into this market this week and wait for buying opportunities over the coming weeks, some will be even luckier and pick some of the winners that are set to go against the tide. A look at the Resources Bourse for my offshore friends…
The ASX has now risen sharply by about 10% and you will note the short term peaks above – in November, start of January, end February and now potentially… where this market has gotten overheated and needed a pause. This combined with seasonal factors seems to suggest traders should tread warily and investors should apply caution right about now. We do not see a long protracted decline, Down Under we are in a long term resources boom and the ASX is overweight resource stocks compared to other international indices.
Further to this comment - there are some stocks, particularly in gold and base metals that are poised for a run, even right now. Uranium stocks in my PDF product have very attractive charts, the stuff of dreams and investors have been cleaning up and many of these stocks now need a pause. We are about to find out what the potential new Labor Government intends to do with their Uranium Mining Policy so all breaths are now held in check awaiting the outcome next weekend. I daren’t guess at the outcome as advice or even opinion – however I can say noises from the moderates indicate that common sense must prevail. I’ll just wait and see, including the reaction of many of the overheated uranium stocks. The market is expecting a pro-uranium mining result. There may be some “live cat” bounces on any meaningful pull backs in the near term.
Sean K
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Re: XAO Analysis
200 points would take it to the 6000 support line mark so my pluck is about there.
200 points would take it to the 6000 support line mark so my pluck is about there.
Sean K
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Re: XAO Analysis
Possibly. 550's a big drop, and 8% is a decent correction. I'm not sure if our market conditions are set for that. There's not too much froth in the ASX appreciation and the overall pe doesn't seem too high. It's about the long term ave I think? Do you know where it's sitting?? Should be some support at 5900 too you'd think so that could be the 2-300 correction mark. 300 is a 5% drop which would be a meaningful pause.