XAO Technical Analysis

DaveMac · 2 January 2010

Re: XAO Analysis

CanOz said:
I gotta say I'm a little skeptical of the last week or so. Volume in the US was and has been really light. I unloaded everything on Thursday night before the holidays, and I'll stand aside until some nice setups appear again. I think the volume needs to come back to be more clear on the continuation of this corrective uptrend.

Cheers,

CanOz

Volume is always light around Decemeber end - all the big players are on holidays :santa:

Most major trend changes happen around March, and we've only just broken out of a consolidation pattern. Not the time to be standing aside IMHO.

Wysiwyg · 4 January 2010

Re: XAO Analysis

Anyone got an opinion on the declining volume in this breakout and resistance zones?

Whiskers · 5 January 2010

Re: XAO Analysis

Wysiwyg said:
Anyone got an opinion on the declining volume in this breakout and resistance zones?

On individual stocks, particularly smaller ones, I often see volume at low levels just before a breakout. My theory is shaky sellers have all sold out and buyers have to bid up to ask price to get their wares.

I suspect that is happening across the board with shaky sellers clearing their hand before the Xmas break and a few smart buyers just starting to bid up a bit.

Now, before the 'Bear' executioners come looking for a meal, my current prognosis based on my previously posted fourth wave triangle suggests the XAO should break resistance and go a bit higher... (a max of 5,233 by this theory), before a correction.

nomore4s · 5 January 2010

Re: XAO Analysis

Wysiwyg said:
Anyone got an opinion on the declining volume in this breakout and resistance zones?

The low volume is purely because of the Xmas period, nothing unusual. Volume should start to return this week, although I thought we would have seen a bit more volume today.

I think the breakout with some better volume could come tomorrow.

CanOz · 5 January 2010

Re: XAO Analysis

nomore4s said:
although I thought we would have seen a bit more volume today.

I think the breakout with some better volume could come tomorrow.

Waiting for a US Lead this time NoMore? I was surprised too, especially given the strong commodity rally.

CanOz

nomore4s · 5 January 2010

Re: XAO Analysis

CanOz said:
Waiting for a US Lead this time NoMore? I was surprised too, especially given the strong commodity rally.

CanOz

I think we're going higher now that's for sure.

With commodities looking very strong tonight I think we will break up through the 4900 resistance tomorrow(provided they hold on to the gains tonight). I think that may draw some volume out and cause a nice run. That's what I'm positioned for anyway.

I would then like to see some consolidation above that 4900 area, late this week or into next week.

nulla nulla · 5 January 2010

Re: XAO Analysis

A strong recovery on the DJIA and Nasdaq on the first day of trade for the 2010 U.S. fiscal year. More than offsetting the drop in the previous days trading being the last day of trade for the U.S. fiscal year 2009.
Some fairly bold predictions in todays Sydney Morning Herald as to where the all ords will go over the next 18 months. NSW unemplyment to fall in the short term as advertised job vacancies increase.

gamefisherman · 5 January 2010

Re: XAO Analysis

A couple of ideas

1. The combined weighting of bhp, rio, the 4 big banks, woolies and a couple of others is enourmous, so any rises in these stocks can distort the real picture,

2. Big Time traders are in the bahamas enjoying their well gotten gains last year and will return in mid Jan then volumes will rise again, and give us a real picture of what is happening, i would be very careful atm of going long on stocks

3. There is also a phenoma called the "Christmas rally" and it has happened this year

4. Ensure that you stick to your trading plan and have tight stops!!!!!!!

Best wishes

Wysiwyg · 5 January 2010

Re: XAO Analysis

I'm in belief that a regurgitative move is over-due. Diverging price and volume from what I have read can be a precursor to a correction.

Wysiwyg · 6 January 2010

Re: XAO Analysis

This lil' evening star sure suggests a top hey. Not a high percentage of up days after them butt you never know in this illusion.

Annwn · 6 January 2010

Re: XAO Analysis

A look at the weekly chart

has broken previous high of 4,900 of Oct 09, approaching previous support of around 5000 area from Jul,Aug Sept of 08,
? this will turn into a resistance level .

The daily chart looks less convincing today, have to wait until tommorrow to see if a evening star pattern forms

cheers

DaveMac · 6 January 2010

Re: XAO Analysis

Wysiwyg said:
This lil' evening star sure suggests a top hey. Not a high percentage of up days after them but you never know in this illusion.

... with so many people waiting to sell at 5000, maybe the market will just never get there.

Wysiwyg · 6 January 2010

Re: XAO Analysis

Annwn said:
The daily chart looks less convincing today, have to wait until tommorrow to see if a evening star pattern forms

Yes a bit premature from me. Reading too much into things again.

nomore4s · 7 January 2010

Re: XAO Analysis

Probably due for some sort of down days.

This is what I want to see play out, but we'll see what happens.

Wysiwyg · 7 January 2010

Re: XAO Analysis

Looking back, the last time the 250 DEMA crossed up over the 250 EMA was in October 2003. On most occasions the market has gone on with it. After a pullback I like to believe a circa 45 ° trend trajectory will be maintained.

Whiskers · 7 January 2010

Re: XAO Analysis

Wysiwyg said:
After a pullback I like to believe a circa 45 ° trend trajectory will be maintained.

Agree... tis also what I meant earlier...

Whiskers said:
Now, before the 'Bear' executioners come looking for a meal, my current prognosis based on my previously posted fourth wave triangle suggests the XAO should break resistance and go a bit higher... (a max of 5,233 by this theory), before a correction.

...a minor correction.

Just expanding my thinking, for me it looks like resource prices will continue to firm. The AUD/USD has had, I reckon, a corrective recovery of late and the next rally in the XAO (after a minor correction sometime soon) most likely will coincide with the next drop in the AUD/USD... ie better news out of the US.

Wysiwyg · 7 January 2010

Re: XAO Analysis

Whiskers said:
Just expanding my thinking, for me it looks like resource prices will continue to firm. The AUD/USD has had, I reckon, a corrective recovery of late and the next rally in the XAO (after a minor correction sometime soon) most likely will coincide with the next drop in the AUD/USD... ie better news out of the US.

I wonder how far away that first rate rise will be in the U.S. (question for the gold fish )

skc · 7 January 2010

Re: XAO Analysis

Wysiwyg said:
Looking back, the last time the 250 DEMA crossed up over the 250 EMA was in October 2003. On most occasions the market has gone on with it. After a pullback I like to believe a circa 45 ° trend trajectory will be maintained.

How do you measure angles on a chart? The two axes are apples and oranges so there really isn't a fixed ratio... or is there a commonly accepted way of plotting?

Trembling Hand · 7 January 2010

Re: XAO Analysis

Whiskers said:
Just expanding my thinking, for me it looks like resource prices will continue to firm. The AUD/USD has had, I reckon, a corrective recovery of late and the next rally in the XAO (after a minor correction sometime soon) most likely will coincide with the next drop in the AUD/USD... ie better news out of the US.

So whiskers with your mighty powers of prediction you believe the AUD/XAO correlation thats been as close to 1:1 all last year is gonna breakdown and then reverse?

Wysiwyg · 7 January 2010

Re: XAO Analysis

skc said:
How do you measure angles on a chart? The two axes are apples and oranges so there really isn't a fixed ratio... or is there a commonly accepted way of plotting?

Hi, if you measure equal distances along the x and y axes from the point of the x,y axes then that hypotenuse is at an angle of 45 °.

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