XAO Technical Analysis

[Whiskers]

Re: XAO Analysis

Up a few points so far today. Looks like we might live to bear another day.

Not expert with this, but it appears we have come back from the 50% mark in every leg up of the bull so far.

 

[Logique]

Re: XAO Analysis

Nice piece of analysis Whiskers. The chart under would add weight to the supportiveness of that 50% fibonacci retracement level. The Bears hadn't ought to get too cocky just yet.

 

[rub92me]

Re: XAO Analysis

Yep. There is just no momentum left in this market. Each rally has less and less to it in terms of the amount of stocks participating. BHP, CBA, WOW etc are fooling anyone that thinks the Bull is still running. Negative divergence grows everywhere you look.

The chart below is the 10 day Avg market breadth. Its been the same pattern since August last year. We get an broad oversold rally from a meltdown then each rally after that is with less and less stocks participating until we get a implosion again and then the pattern repeats.

Only good thing that can be said is every time we get down here we really hard. For a while

Great chart trembling Hand!, gives a very refreshing new perspective on what's going on. What data source / software do you use to make these charts, or do you calculate it manually based on your standard EOD data?

 

[Trembling Hand]

Re: XAO Analysis

Great chart trembling Hand!, gives a very refreshing new perspective on what's going on. What data source / software do you use to make these charts, or do you calculate it manually based on your standard EOD data?

Thanks. It’s pretty surprising how little momentum is left in this market. If you are an index trader it doesn’t matter so much but if you are a stock picker playing on the long side is getting harder and harder.

I have EOD data in a MS Access database and run Queries that I plot in Excel.
I think it always pays to look beyond the way to top heavy Cap-weighted indexes.

 

[hacheln_mice]

Re: XAO Analysis

Nice piece of analysis Whiskers. The chart under would add weight to the supportiveness of that 50% fibonacci retracement level. The Bears hadn't ought to get too cocky just yet.

Who're you calling a bear? I'm always bullish on the stocks I own.

 

[Awesomandy]

Re: XAO Analysis

if you are a stock picker playing on the long side is getting harder and harder.

I definitely agree with that. I generally keep track of around 20 - 30 largish stocks. They are more for personal entertainment rather than money making, and if someone asks me what's worth considering, I could give them a few suggestions. However, lately, I have ran out of such suggestions. There's really nothing worth buying given the current risks, unless we head into the more speculative end.

 

[sassa]

Re: XAO Analysis

Repeating the words of Alan Wood,"Merry Christmas and caveat emptor."

 

[willow]

Re: XAO Analysis

Trendline still intact on this XJO chart. The 34 week ema has seen a close below it again, the first being in August since prices rose above it at the beginning of the bull run in 2003.

 

[willow]

Re: XAO Analysis

These extreme oversold readings of the ROC indicator marked by the arrows and corresponding with the vertical lines on the chart have the same thing in common. They occured when the XAO had been trending up and are more than 3 years away from any other extreme reading which is suggesting the market had changed it's stripes by this heavy fall in momentum. While most of these proved to be good trading opportunities [depending on ones time horizon] the market in all cases accept the most recent,[ as yet?], fell back to near or beyond the levels caused by the heavy fall in momentum, before being able to continue another uptrend. This is suggesting to me a move back to the August lows or beyond. Time will tell.
Time to put the charts away and enjoy the family. Happy Xmas

 

[Peakey]

Re: XAO Analysis

Type A divergence showing.

The recent low over the last week, has not registered a lower low on the stochastic compared to the mid November lows.

 

[Nyden]

Re: XAO Analysis

Why are you all still on holiday? Christmas is over, get back into the markets!

Really surprised at the lackluster gains today, base metals were way up, we had 2 days of Dow Gains that should have been facotred in (guess the yanks don't have an equiv of boxing day).

Guess the total lack of volume today explains as to why gains were modest Everyone's still on holiday! Slackers

 

[M34N]

Re: XAO Analysis

Why are you all still on holiday? Christmas is over, get back into the markets!

Really surprised at the lackluster gains today, base metals were way up, we had 2 days of Dow Gains that should have been facotred in (guess the yanks don't have an equiv of boxing day).

Guess the total lack of volume today explains as to why gains were modest Everyone's still on holiday! Slackers

Volumes too low to push the market much higher, look at BHP, only 5.6m traded today = at best only half the normal rate. But looking at some stocks, like WPL, STO, NCM, volumes were lower but they were pushed still pretty high, with WPL closing at a day high +4%. Also note the very few buyers of MQG during the 4:00-4:10 close, it dropped some 1% at the close thanks to the little buying.

Don't expect much until around Jan 7th.

 

[chops_a_must]

Re: XAO Analysis

Trendline still intact on this XJO chart. The 34 week ema has seen a close below it again, the first being in August since prices rose above it at the beginning of the bull run in 2003.

I know from your other chart, you are more cautious than this suggests. But I'll add my 2 cents worth anyway. There are a number of visual differences that seperate the last few months from all those other corrections so far. The August correction came off a rounded top. The first correction in this bull market to do so. All the others have been off parabolas almost.

The December correction was the first in this bull market that wasn't coming off an all time high. I think that is pretty significant. All of the worst corrections in history (from what I've seen anyway) come off highs that have failed to take out recent all time highs.

Just to clarify my position regarding my last chart, that count was an alternate suggestion and is not the primary count I think headlines the market. For this to be valid we'd need to see 6700 breached again and with the wobbles being seen at present and lack of Santa's appearance I don't think too much upside is plausible.

Below is what I have been running with for a number of months and suggests a return to the August lows. A break of those lows places us into bear market phase of which I think we will see a 1989 - 1994 repeat scenario. Copper, being a lead indicator for economic expansion, is breaking down through significant supports. Interest rates are rising and will soon be at an important level from an asset allocation perspective. 2007 has been a year of 'a few good stocks'. Remove those and its actually been a bad period. My 2c...

Whether or not we are in a bear market (I think we probably are, hell I'll claim to be the first calling it, after wayneL or someone did 3 years ago.), you've probably got to trade it as such. We've had a gap down through suppport (17/12) off highs, which hasn't even looked like being filled. So to me, the market looks to have confirmed a breakdown and it's just a signal to get short. I think for the time being at least, yes, we are in a short term bear market at the very least.

 

[CFD]

Re: XAO Analysis

Nice post chops.

 

[Nyden]

Re: XAO Analysis

Damn Bhutto, if the US markets hadn't gone & had a mass sell off we would have had a good day. How can the huge rise in commodity prices over the last few sessions be totally ignored? Every single base metal is sitting in the green right now, it's not like it's "news" or anything that the entire region there isn't stable

I understand the whole concept of risk aversion, just feels like we're getting screwed here, is all Alright, rant over


Obviously this whole Bhutto mess has led to panic/risk aversion selling that really isn't based on any fundamentals other than the chance of turmoil?
....Which wouldn't even really affect many stocks here directly?

Very selfish of Bhutto really, these countries should put their chaos on the back-burner until the credit crunch sorts itself out! ...Obviously joking

 

[willow]

Re: XAO Analysis

Reading another article by Tim Wood to-day. http://www.financialsense.com/Market/wrapup.htm He mentions 4 year cycles from one bear market low to the next and that the Dow is in the second longest cycle since 1896. I put to-gether a monthly chart using my very limited knowledge of these 4 year cycles. I'm going on appearance and time in this chart and the limited information that one gets from a small article. My data only goes back to 1980. I nearly wasn't going to post this chart being out of my usual reference but here goes. The point mainly I suppose is that it is no surprise at this moment in time for a correction. I think the average on these times om this chart is about 50 months at the moment.

Chops A Must, you bring up a very significant bit of analysis and worth more than 2 cents. I mainly posted the chart with the 34 week ema just to show a general picture. I noticed you re-posted Nick's chart. Seeing Nick's impressive charts and getting his view on this forum is a big bonus. I don't know much about Elliotwave and leave that to the experts like Nick Radge. Looks like the technical evidence building. Cheers.

 

[willow]

Re: XAO Analysis

For those interested about Dow theory, if you are still around Niki. The article by Tim Wood in my post above also mentions how "some analysts use the Utilities in Dow theory", and because of this I'd say a different possible outcome is seen at times. According to Tim Wood the Utility sector came into being after Dow's death and is not a part of Dow theory. Only the relationship between the Industrials and Transport are used. For those who didn't get to read my first post, here is the link on Dow theory again. He also adds other relationships to back up his analysis further.http://www.financialsense.com/Market/wood/2007/1214.html

 

[willow]

Re: XAO Analysis

Sorry but I wrote a couple of the times wrong on the monthly chart. Here is the chart with more the proper times within reason. It still averages out at 50 months so far. My brain gets a bit bamboozled doing figures for to long. Cheers

 

[treefrog]

Re: XAO Analysis

Nice post chops.

agrees wif CFD

and while its a long time since treefrog went to chart school, he seems to remember something about taking care not to place much weight on trendlines over long periods of time 10+ years unless they were on a semi-log price scale to bring prices over different decades into some relativity

 

[Uncle Festivus]

Re: XAO Analysis

Whether or not we are in a bear market (I think we probably are, hell I'll claim to be the first calling it, after wayneL or someone did 3 years ago.), you've probably got to trade it as such. We've had a gap down through suppport (17/12) off highs, which hasn't even looked like being filled. So to me, the market looks to have confirmed a breakdown and it's just a signal to get short. I think for the time being at least, yes, we are in a short term bear market at the very least.

How would a double top on the monthly S&P500 look then - a bit bearish? If the ASX20 start to look sick......this bull game is over?

For those interested about Dow theory, if you are still around Niki. The article by Tim Wood in my post above also mentions how "some analysts use the Utilities in Dow theory", and because of this I'd say a different possible outcome is seen at times. According to Tim Wood the Utility sector came into being after Dow's death and is not a part of Dow theory. Only the relationship between the Industrials and Transport are used. For those who didn't get to read my first post, here is the link on Dow theory again. He also adds other relationships to back up his analysis further.http://www.financialsense.com/Market/wood/2007/1214.html

....... FedEx Corp., the second-largest U.S. package-delivery company, reported a 6.3 percent drop in quarterly profit because of softer demand for freight shipments and higher fuel costs.
``We see challenging near-term economic trends,'' Fred Smith, chief executive officer, said in a statement on Dec. 20.