XAO Technical Analysis

[nomore4s]

Re: XAO Analysis

Just for a bit of fun - 3 different triangles in play

 

[Boggo]

Re: XAO Analysis

ps: are we in a wave 4 EW'ers?

If this is a W.4 then the chart below (ASX 200) may be a guide to the outcome if C = A.

A break above 4800 would be nice but a break below 4560 on another run down would be the first step to the 4300 to 4400 area assuming W.4 retraces 38% to 50% of W.3.

Just my amateur

(click to expand)

 

[Whiskers]

Re: XAO Analysis

Any comments re the gap? last few gaps on the index were filled and were followed by an immediate sort of push?

The staggered open screws things up. You have to find a chart that adjusts for the staggered open (called the XJO gap chart).. Haven't seen a reliable vendor of those for agessss.

There was a thread about this I think involving whiskers and TH a while ago, maybe in this thread?

Yes, controversial issue... but my point was that they are generally filled.

Re, that discussion earlier in this thread with TH, it got too much into finite detail as skyQuake illudes to. All I would say is that so long as you compare apples with apples, ie the same type of data and chart, then the comparrison is generally valid... ie if the same process deals with opening issues on each day and chart then there is a valid comparison. How significant that comparison may be is another issue.

Now... I'm in concert with the current theme of this thread... triangles. As others have indicated we are getting close to something breaking one way or another.

I'm still leaning to a break up, which seems to be supported by my fundamentals and translated into this macro (weekly) EW count. For me the lead indicator will be the AUDUSD continuing to fall.

 

[Wysiwyg]

Re: XAO Analysis

Just for a bit of fun - 3 different triangles in play

So which one do you lean toward?

The symmetrical is the more honest drawing in my opinion.

 

[nomore4s]

Re: XAO Analysis

So which one do you lean toward?

The symmetrical is the more honest drawing in my opinion.

None really, all three really mean squat. We can break up or down from either one, none give any real idea of future direction - All they really tell us is which ever way we do break it will probably be quite a good move.

As stated earlier I favour a move down from here but it could go either way really. I don't think we will see much conviction either way till the New Year now but you never know with the markets.

 

[Broadway]

Re: XAO Analysis

Every dip gets bought.

Dubai, Greece, whatever bad news comes is hit with buying.

Whatever good news occurs (US gdp/jobs) at the top of the range gets shorted.

There would have to be a catastophic event to send the xao/es down a long way.

Interesting that the USD and the ES went up last night. They are trying hard to divorce(from the long held inverse relationship), but if the ES falls early next week then the relationship is still present.

If anything the xao is lagging the climbing ES, and may want to catch up next week, esoecially if the ES keeps rising.

 

[nulla nulla]

Re: XAO Analysis

Looking at the shoulders in your graph, the November shoulder is higher than the October shoulder. It would appear to indicate that the xao will go above 4800 if it can bounce before 4500. If it doesn't get support above 4500 then the next level of support appears to be 4400.

Although the Dow fell 150 last night it is still above 10,000. The banks in the U.S so far have indicated that they have neglible exposure to Dubai (as have the Australian banks) but the market is wary of the impact of indirect exposure.

A significant impact has already been felt in the Commercial Property sectors. It appears the market is expecting some of the Dubai properties to come onto the market at significant discounts to market value, dragging down the rest of the property values as properties are sold to raise capital to invest in the Dubai bargains.

This could also partially explain the pull back in the Australian Dollar, funds being converted out of the Aud$ to be used for buying into Dubai if there is a sell off of assets to reduce debt.

And the wheels go round and round

As at Friday 11 December 2009:

http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=au:xao

The XAO rose for 4 straight days then fell for 5 straight days before a minor bounce yesterday. The high was barely less than the height of the previous shoulder (arround 4800) while the low was higher than the previous low finding support in the low 4600 area.

There seems to be a lack of confidence in the market atm holding it back from breaking through the 4800 resistance. The lack of confidence continues to dominate, which is odd given the news regarding Employment & Housing in Australia and the encouraging signs in China and the USA.

In the lead up to the Christmas/New Year break I would not be surprised to see a further retrace to the 4500 support levels as volumes in turnover drop and people pull their money out for the holiday period.

 

[Logique]

Re: XAO Analysis

If anything the xao is lagging the climbing ES, and may want to catch up next week, esoecially if the ES keeps rising.

Silly Q. what do you mean by the ES?
Very confusing situation with the market indices, just don't know which way it's going to break. Range trading, and not a lot of conviction. The stocks I follow do seem to react to the USD strength or weakness, so this might provide a leading indictor as others have said.

 

[Broadway]

Re: XAO Analysis

Silly Q. what do you mean by the ES?
.

ES is the s+p500 futures.

 

[MRC & Co]

Re: XAO Analysis

Interesting that the USD and the ES went up last night. They are trying hard to divorce(from the long held inverse relationship), but if the ES falls early next week then the relationship is still present.

If anything the xao is lagging the climbing ES, and may want to catch up next week, esoecially if the ES keeps rising.

Exactly and exactly.

Once again, they tried to break the USD/ES negative correlation down on non-farms (last time failed, will be interesting to view if it will fail again once more).

But if like you say, the ES does climb nxt wk, I will be looking for the SPI to get some panic buying to try and catch up.

On that note, in SPI orderflow over the last few days, there has been a HUGE seller distributing, just sitting on the asks trying to take fills, and whenever other markets tank, he panics and goes to market for fills.

Good comments Broadway.

 

[Naked shorts]

Re: XAO Analysis

Once again, they tried to break the USD/ES negative correlation down on non-farms (last time failed, will be interesting to view if it will fail again once more).

Its over, and should be for a little while yet imo. Any good news that comes out now is seen as a sign the US will raise interest rates which which causes the USD to rally.. any bad and the USD tanks before people scared of the inevitable buy into the move. All carry currencies eventually have their run. Ive been riding it since last friday... S/L's and trailing T/P's are delicious :drink:

Of course, I could be wrong and my opinion could change 10seconds after I post this.

 

[MRC & Co]

Re: XAO Analysis

Its over, and should be for a little while yet imo. Any good news that comes out now is seen as a sign the US will raise interest rates which which causes the USD to rally.. any bad and the USD tanks before people scared of the inevitable buy into the move. All carry currencies eventually have their run. Ive been riding it since last friday... S/L's and trailing T/P's are delicious :drink:

Of course, I could be wrong and my opinion could change 10seconds after I post this.

Ah, interesting, I haven't been watching the figures affecting the USD close enough over nights lately, but I trust your point.

With oil coming off so far and a good leading indicator, could be a real rally here in the USD to come yet!

Short AUD could be a great short from here, considering it is still relatively high.....

 

[white_goodman]

Re: XAO Analysis

Id really like to see oil below 66 and AUD below 89 before i got heavy short atm, likewise Euro below 1.45's, but yeh Im pretty sure DX did good volumes off weekly support, so we may see a run to atleast 80 on zee old DX

 

[Naked shorts]

Re: XAO Analysis

Short AUD could be a great short from here, considering it is still relatively high.....

Well thing is with a strong AUD the Australian economy isnt under much stress compared to all the other high yielding nations. Plus the interest rate difference isn't all too high and the whole world loves Australia atm (cause its a non corrupt com country right next to China)

ZAR and TRY are a little bit different on the other hand..


but all eyes are on the TED spread to see if this move has momentum.
http://www.bloomberg.com/apps/cbuilder?ticker1=.TEDSP:IND

 

[Naked shorts]

Re: XAO Analysis

Id really like to see oil below 66 and AUD below 89 before i got heavy short atm, likewise Euro below 1.45's, but yeh Im pretty sure DX did good volumes off weekly support, so we may see a run to atleast 80 on zee old DX

A run on a carry currency wouldn't move around like that. The moves are always negatively skewed.
http://davidmlane.com/hyperstat/pictures/sdr1.GIF

Lots of research papers on the net about it.

 

[Wysiwyg]

Re: XAO Analysis

Fairly basic pattern is the symmetrical triangle. The narrowing of swing range is between 70 points now so I believe a breach of these (imaginary) boundaries will happen soon. An alternative is the swing boundaries being extended and hence breaking down the triangular pattern. Christmas cash-in may have begun.

Continuing from the previous triangle formation the index price poked through the imaginary confine by about 10 points. A few eager beavers there no doubt. A matter of time before the top line gets questioned or the price disappears through the bottom line. Usually a continuation pattern in an uptrend.

 

[Kryzz]

Re: XAO Analysis

Continuing from the previous triangle formation the index price poked through the imaginary confine by about 10 points. A few eager beavers there no doubt. A matter of time before the top line gets questioned or the price disappears through the bottom line. Usually a continuation pattern in an uptrend.

Found this to be an interesting Read, with re to the sym triangle.

http://thepatternsite.com/TrendChanges.html

Will be watching reaction if/when price reaches the apex point, be it a break up or down from the triangle. Hugging the trendline atm, coming up to some resistance, interesting ew position too.

 

[MRC & Co]

Re: XAO Analysis

Well thing is with a strong AUD the Australian economy isnt under much stress compared to all the other high yielding nations. Plus the interest rate difference isn't all too high and the whole world loves Australia atm (cause its a non corrupt com country right next to China)

ZAR and TRY are a little bit different on the other hand..

Yeh, agreed, but at the same time, most quantatative 'fair value' models have the AUD slightly overvalued still against the USD.

 

[Naked shorts]

Re: XAO Analysis

Yeh, agreed, but at the same time, most quantatative 'fair value' models have the AUD slightly overvalued still against the USD.

Since when do currencies ever go near their "fair value"?

 

[MRC & Co]

Re: XAO Analysis

Since when do currencies ever go near their "fair value"?

Well it depends what 'fair value' modelling you are talking of.

I am talking of a model much more complex than simply based on CPI. Not that it always works, but if it aligns with other factors, only adds more conviction.

RBA comments today help too!