Technicals | Apr 10 2017
By Craig Parker, asset manager, Moat Capital
Nothing to see here was the message this week as our market went sideways every day of the week. Not one range was an upward or downward range. I still get the feeling as I mentioned last week that we are looking at more of a breather before making another attempt at 6000. One of the reasons is our financials sector, which is still illustrating signs of bearish divergence on the weekly chart. Also, the S&P 500 is still in a short-term downtrend and the price action is very close to the downtrend line. Interestingly the Russell 2000 Index has broken down overnight [Friday] after finding resistance against the 60-day moving average which isn’t a great sign for the short term.
Another negative is Gold which broke through the 1260 barrier and more importantly the 200-day moving average confirming, a move into a medium-term uptrend [since back under 1260]. This could suggest some uncertainty in equity markets. On a positive note, Iron Ore may find support at the 80 mark [since at 75] and our energy sector did its best to hold up our market today [Friday] with continued upward momentum in the Oil price after gaining support around the 200-day moving average a couple of weeks ago. Overall the price action is a little mixed and once again all hinges on the S&P 500 overnight with the short-term downtrend line to the upside and the 60-day moving average to the downside. A break up through the downtrend line indicating renewed upside momentum and a break down possibly fueling a greater movement down towards the 200-day moving average.
ASX200 daily
ASX Financials weekly
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S&P500 daily
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Gold weekly
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Oil daily
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Authorised Representative Sentinel Private Wealth AFSL 344762
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