Technicals | Mar 06 2017
By Craig Parker, asset manager, Moat Capital
No man’s land! That is where we are with our market sitting between the 5800 and 5600 levels as touched on in past weeks. We haven’t gone anywhere this week and everyone seems to be getting a little concerned. Volatility is showing signs of breaking out to the upside which isn’t a great sign for our market. The S&P 500 is over-bought and has bearish divergence on the RSI. It is looking to have that counter trend it so needs. 5% would be perfect however, it remains to be seen if Janet Yellen and her crew raise rates in March which, could cause possible further downside. The breakout immediately post Trumps speech to congress is looking like a fake move – couldn’t help myself. Trump seems to have taken to the theory of tell a lie once it is a lie tell a lie a thousand times it becomes truth.
As far as our market goes I would be looking closely at the 5600 level and a break in the medium-term uptrend line which we are currently right on now. A breach of the 5600 level and things are looking weak from a technical perspective. The daily chart would be in a downtrend and the weekly chart would have a trough lower than the previous which, would be mixed news considering the peak is higher. The monthly chart would still be looking ok for the longer-term investor. Looking forward to the week ahead! Hopefully the OECD report on housing doesn’t spook the market. A few negatives on the horizon.
ASX200 daily
ASX200 VIX daily
S&P500 daily
Authorised Representative Sentinel Private Wealth AFSL 344762
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