Technicals | Jan 23 2017
By Craig Parker, asset manager, Moat Capital
As mentioned last week, caution was on the short-term agenda and the question now is whether we have seen the end of the counter trend. I did mention last week that I would like to see our market move further down, possibly between the 5500-5600 levels which would be a good technical level to kick off back into the overall uptrend. We are also a little way off getting back to the 60-day moving average on the daily chart below. Not that this necessarily means the recent move down will hit the 60-day average as it could be the next move down whilst the 60-day average is catching up to the market.
If you look at the monthly chart there is a clear Bullish moving average crossover and the MACD and RSI are in the mid-range so not oversold or overbought. This is a good technical sign for the medium to long term outlook. The US market (S&P 500) had a little jump on Friday although we will get a better indication going into this week. The S&P 500 still hasn’t broken up through its 2-month trading range. Our market will be watching for a breakout up through this range or further resistance resulting in a move down. The S&P/ASX 200 VIX below has some room to move up to the downtrend line which would mean some downside for our market in the short term. Overall our market from a technical perspective is still looking a little nervous in the short term and remains positive over the medium and long term.
ASX200 daily
ASX200 monthly
S&P500 daily
ASX200 VIX
Authorised Representative Sentinel Private Wealth AFSL 344762
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