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XAO Technical Analysis

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Re: XAO Analysis

davo8 said:
No. I'll stick to my forecast, based on a solid understanding of the truly awful fundamentals and major disasters still bearing down on the US economy.

1. The US will be in recession/depression all this year and most of next. Any recovery will be slow and weak, and likely followed by a further collapse in 2011, at least partly because oil will rise sharply.

2. All countries exporting to the US will suffer eg China, Japan, SE Asia, Gulf. Australian GDP will remain subdued.

3. This is NOT the bottom. The next dip will go lower. Watch for a crisis in May. Sell while you can.:22_yikes:
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All though I share your 'long-term' views on how the US is going to turn in it's grave, and that probably the rest of the world will follow, I think it will take longer then May for it to reflect in the stock market. In the mean time, price action is your friend and charting your way through the markets is going to prove the winning bet one would think. Chuck this fundamental crap out the window.
 
Re: XAO Analysis

Logique said:
Cause for enormous concern that US market indices have broken below key technical support levels.

The DJIA has broken below 7500 and the SPX below 800. Needs to turn around real soon and consolidate from here, otherwise we can see significant further falls in the US market.
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Well blow me down if the DJIA and SPX haven't moved back above these key levels, and into the bargain the XAO so far has held above the 3100 level (at 3500 plus this morning). Good fuel for the bulls, but I'm not sure a 7% overnight gain in the US indices can hold without some consolidation.
 
Re: XAO Analysis

Short Australia 200 Cash from last 1h bar close at 3620.

Mostly as a hedge against open longs on the market which I do not want to give up.
 

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Re: XAO Analysis

Hi guys,

Will exit this position now (3556) if there is a bounce from current level, or add to the position if there is a break down.
 
Re: XAO Analysis

Ok closed the short on a wide-arsed spread at 3562 after break of intermediate trend-line and bounce off 800MA on the 15m.

So I lied a bit when I said this was a hedge, it was also because I was a bit bored with forex and saw a move on the index. But anyway, profits from this have hopefully offset any losses from my pretty tiny longs over the next few days. Thankfully mostly small lots on gains derived from the forex, so not too concerned, but if we fall back under the 50MA on the daily I will probably add shorts again.

I notice I am the only one posting, hope my posts are not annoying anyone!
 

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Re: XAO Analysis

sinner said:
Ok closed the short on a wide-arsed spread at 3562 after break of intermediate trend-line and bounce off 800MA on the 15m.

So I lied a bit when I said this was a hedge, it was also because I was a bit bored with forex and saw a move on the index. But anyway, profits from this have hopefully offset any losses from my pretty tiny longs over the next few days. Thankfully mostly small lots on gains derived from the forex, so not too concerned, but if we fall back under the 50MA on the daily I will probably add shorts again.

I notice I am the only one posting, hope my posts are not annoying anyone!
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Nah. Couldn't sleep anyway!

How many pair of shorts did you say you were going to add? :D
 
Re: XAO Analysis

Hmmm I made a prediction in Oct last year that the XAO would be at 4100 april 1st. based on a variation of the chart I'm about to post. Unfortunately I was wrong, but at the time 4100 seemed quite a long way down ;)

I posted this over a T$ but It might be a better place here ;) be warned my charting is notoriously inaccurate, and my interpretations perhaps a little unorthodox, so laugh if you must, but I reckon we saw the bottom... of course anything is possible with the worlds economic meltdown, so take this post with a bucket of salt!

If you look far enough back in this thread you will probably see previous incarnations of this chart, I suspect some of the posts saying that we were going to see an 87 style crash.

below from my post at T$

----------------------------------------------------------------------

Well I decided to fire up Incredible charts again, and have another look at the XAO. I've gone back to my original trend channel, with a slight adjustment for the latest plummet and turnaround, and it to me is looking quite interesting.

I haven't really used the commodity channel indicator before, but in this application it seems to be quite telling, certainly it would seem that when approaching the -200 mark it is a pretty safe bet that the current bottom has been reached (this on the monthly chart, I haven't looked at weekly or daily). This has been the case for almost all of the worst bottomings in the last 30 years.

The other thing I found interesting was the RSI. I had been using it to try and predict the top of the market (before I lost interest and foolishly stopped, otherwise I may be a lot better off now than I am)... It's normal oversold level (on the monthly) seems to be around 40, though in this case it has gone down to almost 20. I really do think we have seen the falling off a cliff stage, and whilst a recovery will probably be long and painful I think we have probably now seen the real bottom... however if you take that bottom trend line as the absolute, then there is potential for the market to stay low for a long time! it could quite easily bounce along off that bottom trendline, and could take many years to go anywhere near the top one!

I've also drawn a couple of parallel lines on the chart, one at 1750 and another at about 3300 (which is the point where the bottom trend channel was touched. we have now recovered to around 3500. What is significant about this? Well from the run up in 1987 before the crash, the XAO hit 1750 in may, 22 years later we are now sitting at just double that at 3500. That is a 100% gain in the market over a period of 22 years. The market has fallen around 50% which means a 100% gain is necessary to get back to where it was before the crash. This crash, to me looks (on the chart) to have been more severe than 1987. Anyway its not all doom and gloom, at least it looks like things are turning around, but it might be a while before the next bubble comes along. I suspect that it is largely a generational thing!

Of course this is all tea leaf reading voodoo, but it looks good on paper

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Tony.

edit: I thought it interesting to revisit this post ;) https://www.aussiestockforums.com/forums/showpost.php?p=143115&postcount=359 The worst bit is, I stopped watching the market around Sep (getting ready for birth of my daughter) and got caught holding all of my stocks :(
 

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Re: XAO Analysis

Possible H&S pattern forming on the XAO. On both the daily & weekly charts but easier to see on the weekly chart.

Of course this is just one possiblity of many. The market will prove or disprove as it sees fit.:)
 

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Re: XAO Analysis

All the double tops on during the bull market were followed up with new highs.

So...a new high could be on the way.......but not yet.

The MACD is totally over cooked in my opinion and is looking to retrace soon.

A break through about 3690 and it should be the next leg up.

Just my thoughts:)
 

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Re: XAO Analysis

Go Nuke said:
All the double tops on during the bull market were followed up with new highs.

So...a new high could be on the way.......but not yet.

The MACD is totally over cooked in my opinion and is looking to retrace soon.

A break through about 3690 and it should be the next leg up.

Just my thoughts:)
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The only difference that i see is that both tops are formed in a bull market while our doble top here is part of the bear leg, not sure if that would make a diff. Just my observations...
 
Re: XAO Analysis

Looks like the banks run finally came to a screaming halt today. I think we'll see a retest of 3500 in the next few days, will be interesting to see if there is any sort of support there.

Chart marked up with some possiblities.

I'm probably favouring #2 at this stage, a pullback just far enough to shake out some sellers then up towards 4300, but the market will do what it wants.
 

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Re: XAO Analysis

Go Nuke said:
A break through about 3690 and it should be the next leg up.
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You may be right, but I'm betting you're not. I read the chart as a primary down trend not yet broken, so we shall be seeing 3200 again.

This is confirmed by the truly horrible economic news still unfolding in US, UK, Europe, Japan, etc. Major indicators point to an outcome as severe as the Great Depression, which should bottom in 2010 and recover slowly. The markets don't look that far ahead.

I hope I'm wrong.
 
Re: XAO Analysis

nomore4s said:
Looks like the banks run finally came to a screaming halt today. I think we'll see a retest of 3500 in the next few days, will be interesting to see if there is any sort of support there.

Chart marked up with some possiblities.

I'm probably favouring #2 at this stage, a pullback just far enough to shake out some sellers then up towards 4300, but the market will do what it wants.
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Hello, yes these are the three responses I have been looking at as we approach this resistence on my chart as well. It will be interesting to see how we go. Obviously option 1 is very bullish and I will be looking to get into the large caps if this pattern emerges. If I had the money I would be shorting the **** out of Gold as well.

W.
 
Re: XAO Analysis

All good ideas nomore.

Trouble is IMO, if that WAS infact the low for some time (perhaps years), we may just move into a choppy range, whereby there will be a serious of HL, LH, LL and HHs, making it very hard to trade, with no clear trend and no clear reference points to trade from.

From trading intraday, these are the parts you need to stay out of, unless you fade a basic area of the range, but it's hard, because you have no clear stop placement (or reference point, as I stated earlier).

Makes it very very tough times for EOD traders IMVHO.

:(
 
Re: XAO Analysis

wonderrman said:
Obviously option 1 is very bullish and I will be looking to get into the large caps if this pattern emerges. If I had the money I would be shorting the **** out of Gold as well.
W.
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Again, I really wonder why. I can understand having a punt on the ASX -- there must be sectors out there that will benefit from something happening somewhere in the world. Not financials, though.

But why bet against gold? There is a significant possibility of a US or UK default (they both did during the last depression), and/or a round of serious inflation (stagflation as per the 1970s). In either case you could get your head handed to you on a platter.
 
Re: XAO Analysis

MRC & Co said:
All good ideas nomore.

Trouble is IMO, if that WAS infact the low for some time (perhaps years), we may just move into a choppy range, whereby there will be a serious of HL, LH, LL and HHs, making it very hard to trade, with no clear trend and no clear reference points to trade from.

From trading intraday, these are the parts you need to stay out of, unless you fade a basic area of the range, but it's hard, because you have no clear stop placement (or reference point, as I stated earlier).

Makes it very very tough times for EOD traders IMVHO.

:(
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You may be right but we will have to see how it all plays out.

davo8 said:
Again, I really wonder why. I can understand having a punt on the ASX -- there must be sectors out there that will benefit from something happening somewhere in the world. Not financials, though.
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Yeah the rally in the financials hasn't been worth trading:confused:. Long term there could be more downside but they will provide some very good trading opps.
 
Re: XAO Analysis

Not sure how this looks on a semi-log, but on this looks to be pushing up against the channel and also horizontal resistance, so this area seems to be significant. Does it fall over and continue the downward slide, to further lows, or start going sideways, or up..

Disregard fundamentals for a moment, and consider the facts.

Of course, the lines could be placed differently to create your own facts too...
 

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