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XAO Technical Analysis

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Darc Knight said:
Should we just put interest rates back to normal levels and take the pain - but each current Governments won't do it.
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Simply YES, treat it as a band aid, sooner or later you have to ripe it off.

And f--k the pollies, as you pointed out, they are self serving and we would be better off without them
 
Trembling Hand used to have the theory about Monday Gaps always filling and if they didn't then watch out below. Theory will get tested tonight - if we can't repair from here then it may be look out below. Even more so given the contextually location.
 
I think we may see some 'bargain' hunters buying tomorrow. How the DOW plays out will be interesting.
 
Cam019 said:
Logique, to me support is still in play with a range of approximately 5640 - 5730. No doubt we are in a short and intermediate term downtrend but the XAO would have to close below 5640 for me to reevaluate what I am currently seeing.
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Whoops, spoke too soon.

 

I would need to be made Emperor with unlimited powers to fix the economy and punish those responsible for the fiscal inadequacies we endure.

There are too many monkeys grinding organs in response to ephemeral data.

gg
 
I don't know where the bottom is, but we must be close to seller capitulation.
Probably nearer to the bottom than the top. ~ 5,000 looks important. 6,400 - 5,000 would be a 21% correction
 
If the XAO doesn't hold up at ~5,500 (61.8% retracement of the last leg up on the fibonacci scale),
View attachment 90884

the next stop might be ~5,200 (38.2% fibonacci retracement of the post GFC bull run)


In any case, with a federal election due in May 19, I don't think any relief rally is going to give a huge or sustained bounce (dead cat bounce coming?).

The price of copper indicates that the forward outlook for the world economy has become more subdued. Is there a head and shoulders pattern forming? Copper could be heading further down before heading back up.

The USA and China are supposed to be working on a trade deal. We might have to wait and see what transpires at the end of March. And of course there is Brexit.

I had made a guess that ten years on from the GFC the XAO would have peaked at parity with the previous top (~6,800) before entering into any major correction but the third wave up from the 2009 low appears to be complete.
 

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Just thought I would chuck my view of the XAO up here. I am seeing a long term rising support line coming from March 2009, touched again in February 2016 and just now it appears to be feeling for that same support. Let's see if it gets that much needed support.

 
I do hope Mark Hulbert is right.
 
And bang, headfirst into a wall that ol' mate Trump would love to have.
Any takers on where to from here ??

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Taking a step back and looking at the big picture, and notwithstanding all the huff and puff of late, this technically can still turn out to be a routine correction. The 2005-07 market action in hindsight was an above trend bubble waiting to burst. By comparison 2018-19 (to this point) looks more routine, even healthy. Heartening for the Bulls.
 
My Elliot Wave 2c worth. Looks like rally will carry further for another week or two, which will be another setup for a great shorting opportunity.

 
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Alright.. so the XAO has broken out out the falling wedge and then bounced around in the marked support zone until yesterday when we have a close outside support. It will be interesting to see if it can hold this level. If it can, we could see a rally to approx. 6,000 in the near term.

If we take a look at the line chart just for a bit of clarity, we have an almost textbook inverse head and shoulders with the breakout of the support level yesterday. Looks bullish to me.



 
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