Australian (ASX) Stock Market Forum

XAO Technical Analysis

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Re: XAO Analysis

Logique said:
Over on the CBA thread, Sinner has posted a chart (22 Nov) showing how CBA has been leading the index, and CBA is at present trending down below the index.
Also I've learnt over the years that you need to be careful about going long so close to Christmas. It would take an attractive discount to convince me to cover any of my shorts from here.
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I think that chart posted by sinner was plainly in reference to CBA outperforming the market, rather than it being a leading indicator from movements of the XAO in anyway. Banks are poorely performing simply due to a lower US$ and the switch to resources.

Also, the XAO has over a 70% of rallying into XMAS.

I see the market going on stronger from here, we have a lot of ground to make up with US if they continue to rally. Have entered a few longs today accordingly.
 
Re: XAO Analysis

sammy84 said:
Also, the XAO has over a 70% of rallying into XMAS.

I see the market going on stronger from here, we have a lot of ground to make up with US if they continue to rally.
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I go along with this. Just looking at the AUDUSD weekly chart, an ascending wedge coming to a point, I think the AUD has probably peaked against the USD for now and set to retreat back into the .80's.

This would give our resource stocks in particular an extra boost assuming that the US economy has probably bottomed and our best resource customer, China, has hardly missed a beat relatively speaking.
 
Re: XAO Analysis

sammy84 said:
I see the market going on stronger from here, we have a lot of ground to make up with US if they continue to rally. Have entered a few longs today accordingly.
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With the current strength in the US markets I too think we could be going higher. The only problem atm is we keep seeing pretty bad fades when we should be seeing strong days, this could be a sign of some selling into strength but if we can push past this area of resistance and the US markets continue on their merry way we could shoot higher pretty quickly.

The flip side of that of course is if we do see some weakness appear in the overseas markets we could see a pretty rapid sell off in the XAO.

I'm still on the fence as far as my trading is concerned, I have a few cautious longs open (mainly longer term holdings but a few shorter term trades) and only one short. I'm happy to sit back and wait for the moment, no need to trade aggressively.
 
Re: XAO Analysis

nomore4s said:
The only problem atm is we keep seeing pretty bad fades when we should be seeing strong days, this could be a sign of some selling into strength but if we can push past this area of resistance and the US markets continue on their merry way we could shoot higher pretty quickly.
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Seems to be quite appropriate to talk about selling into strength at the moment. The only thing is the low volumes at present don't indicate conviction selling either. I really am struggling to understand these fade-outs. The US nearly faded-out this morning, but then rallied slightly again in the last 10min.

Interesting times, either way I feel that we are in for an explosive move one way or another.
 
Re: XAO Analysis

Personally think you guys are wrong :D refer to my XAO chart posted here before (ignore the red stop line as was supposed to be a range placed there and im not that good at posting charts ) the jist IS that my analysis STILL stands , not been proven wrong as YET and also refer to the "xao banter " thread ...

Weeklies one BEWT head and shoulder pattern on XAO, dailies confirming.

I could be wrong but i think not on this one ;)

I suppose thats what makes a market. one bloke thinks the other bloke is wrong regardless of who is right :D
 
Re: XAO Analysis

sammy84 said:
I think that chart posted by sinner was plainly in reference to CBA outperforming the market, rather than it being a leading indicator from movements of the XAO in anyway. Banks are poorely performing simply due to a lower US$ and the switch to resources.

Also, the XAO has over a 70% of rallying into XMAS.

I see the market going on stronger from here, we have a lot of ground to make up with US if they continue to rally. Have entered a few longs today accordingly.
Click to expand...

Hey I'm famous! People are talking about me, better sell a trading system while I can! :p:

I would just like to raise a few points if that is ok. These are just foods for thought I have no bias currently.

1. The SP500 rise in November has been on declining volume. Bearish.
2. The daily momentum MACD (5,35,5) and normal MACD (12,26,9) for this index have been making lower highs (divergence highs) since the Aug-Sep highs. The fade of the first 0 cross since July was the above rise in declining volume although we did manage a higher high. Indicates down-trend imminence. But this could just be a market pullback, not the resumption of the 08 bear.
3. I am not interested in shorting any index until ES has a consistent NY trading session under 990 (as this is the bullish level which caused the current breakout imho)
4. We really aren't that overbought in the context of 0% money.
5. Goldman Sachs can do whatever they like.
6. When the top comes, nobody here will have picked it.
 
Re: XAO Analysis

nunthewiser said:
Hehehehe :D i already have dude :D
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Well I admit, this is as good a place as any to short considering the low vol run up on the SPX. But if you have "picked the top" then you should have a target, timeframe and exit plan, do you mind sharing them with us so we get a bit of an idea of your thinking?
 
Re: XAO Analysis

sinner said:
Well I admit, this is as good a place as any to short considering the low vol run up on the SPX. But if you have "picked the top" then you should have a target, timeframe and exit plan, do you mind sharing them with us so we get a bit of an idea of your thinking?
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Scroll back in this thread for chart ..... Also Xao banter thread ...... first target 4500, will re-evaluate from there IF there is a bounce ..... i cannot give a timeframe as the ball moving at varying speeds with these lower vols... currently only short one stock as mentioned in banter thread . was short a bank also but got trailing stop hit on it ( anz) previously....

I was attempting humor on my previous post ......pay no heed .......

Back to being a meek and godly nun in chat whilst waiting for henny penny to sqwawk
 
Re: XAO Analysis

nunthewiser said:
Scroll back in this thread for chart ..... Also Xao banter thread ...... first target 4500, will re-evaluate from there IF there is a bounce ..... i cannot give a timeframe as the ball moving at varying speeds with these lower vols... currently only short one stock as mentioned in banter thread . was short a bank also but got trailing stop hit on it ( anz) previously....

I was attempting humor on my previous post ......pay no heed .......

Back to being a meek and godly nun in chat whilst waiting for henny penny to sqwawk
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Ah ok, I misunderstood you. I thought you said you had picked the top, which means to me you expect at least a 25% retrace from the highs! Targetting 4500 is just a healthy retrace of the trend?
 

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Re: XAO Analysis

Hey whiskers, imo the correlation between the AUD and Equities market is too strong for a selloff on the AUD to be good for miners.
It seems that the AUD has become a risk proxy for equities, (in fact correlation with emerging markets is stronger than for our bourse)
Will be very interesting to see what ahppens if the bond decides to break.
 
Re: XAO Analysis

sammy84 said:
Seems to be quite appropriate to talk about selling into strength at the moment. The only thing is the low volumes at present don't indicate conviction selling either. I really am struggling to understand these fade-outs. The US nearly faded-out this morning, but then rallied slightly again in the last 10min.

Interesting times, either way I feel that we are in for an explosive move one way or another.
Click to expand...

You can only sell into whatever strength there is available. If the demand isn't there to sell high volumes into you can only off load so much without causing prices to drop too far. This probably also indicates there isn't much demand at these levels, not a good combination.

The fact is the last few times the DOW has had a 100+ point day and we would normally expect the XAO/XJO to have strong days we have had weak days. Whether the market can absorb this weakness and push higher or not is yet to be decided.
 
Re: XAO Analysis

nomore4s said:
The fact is the last few times the DOW has had a 100+ point day and we would normally expect the XAO/XJO to have strong days we have had weak days.
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Seems to me there is a valid not-necessarily-bearish reason for this though:

Every time the Dow had 100+ point day, AUDUSD and AUDJPY would be rising overnight at the same levels as well as commodities. So on the open many of the export companies making up the ASX (for example look at CVN and IAU) will have lost some competitiveness overnight. So the rise on XAO would be proportional to that?

Please correct me if this is blatantly wrong.
 
Re: XAO Analysis

sinner said:
Seems to me there is a valid not-necessarily-bearish reason for this though:

Every time the Dow had 100+ point day, AUDUSD and AUDJPY would be rising overnight at the same levels as well as commodities. So on the open many of the export companies making up the ASX (for example look at CVN and IAU) will have lost some competitiveness overnight. So the rise on XAO would be proportional to that?

Please correct me if this is blatantly wrong.
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No idea but I don't think it would account for the fades we are seeing halfway through the day, could be wrong though.
 
Re: XAO Analysis

nunthewiser said:
Personally think you guys are wrong :D refer to my XAO chart posted here before (ignore the red stop line as was supposed to be a range placed there and im not that good at posting charts ) the jist IS that my analysis STILL stands , not been proven wrong as YET and also refer to the "xao banter " thread ...

Weeklies one BEWT head and shoulder pattern on XAO, dailies confirming.

I could be wrong but i think not on this one ;)

I suppose thats what makes a market. one bloke thinks the other bloke is wrong regardless of who is right :D
Click to expand...

My longer term analysis is also still in play, we need to see the down leg eventuate shortly though or it will be invalidated and I'll have to come up with a new guess.

https://www.aussiestockforums.com/forums/showpost.php?p=505591&postcount=7685
https://www.aussiestockforums.com/forums/showpost.php?p=507013&postcount=7699
 
Re: XAO Analysis

nomore4s said:
No idea but I don't think it would account for the fades we are seeing halfway through the day, could be wrong though.
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Half way through the day? The fades start essentially right after the open today, and the same on 3 occasions last week.

Speaking of correlation... there has been strong correlation between USD, DOW and GOLD. If I understand what many are saying is that GOLD and equities have been rising at the expense of the fall in USD. But I get a sense that this correlation is breaking down. Can USD and GOLD both rise at the same time? Does that signify that risk aversion is back in vogue?
 
Re: XAO Analysis

nomore4s said:
You can only sell into whatever strength there is available. If the demand isn't there to sell high volumes into you can only off load so much without causing prices to drop too far. This probably also indicates there isn't much demand at these levels, not a good combination.

The fact is the last few times the DOW has had a 100+ point day and we would normally expect the XAO/XJO to have strong days we have had weak days. Whether the market can absorb this weakness and push higher or not is yet to be decided.
Click to expand...

Agreed and not at the same time. There may be selling into strength, but I would exactly call the last days price action 'strength'. There should have also been some conviction selling on down days aswell to accompanying this bearishness. I really dont under these fades. The US on the other hand has happy some pretty good strength in the last 10-15 minutes of trading the last few days.
 
Re: XAO Analysis

Some questions for you (and my guesses - they may be somewhat oversimplified, I dont claim to be an economist!) :

1) Which way is the US$ headed?
I think stagnant or down - US surely is in no hurry to raise interest rates. One way to reduce it's large debt would possibly be to let the $ slide further.
2) Which way is the A$ headed?
up or the same by token of my last answer - that and Mr Swan says interest rates are headed up.
3) Will the US, ASX markets stay strongly coupled to the way the US$ is moving?
Probably?

So, to summarise my theory is that unless there is some kind of trigger/catalyst I think we continue the same direction we have been. Plus I saw this the other day:

http://www.minyanville.com/articles...n-socgen-pharma-minyanville/index/a/25587/p/1

Societe Generale reckons that while the retail investor is highly invested, the funds aren't:

Comments?
 
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