Technicals | Jul 11 2017
By Michael Gable
The last few weeks have seen Australian and US markets drift sideways, with a lack of overall direction. A key difference is that the Australian market in particular has seen some massive swings. The last 6 weeks has seen the S&P/ASX 200 Index move more than 100 points in each week. The volatility has been a welcome change, depending on your point of view. It would be frustrating for index funds which have had a good few months for the first time in years, but volatility is good for the active managers. The tide is inevitably turning. We have a chart of the S&P/ASX 200 Index in today's report along with further stock opportunities which should be taking advantage of this volatility.
ASX200 daily
The S&P/ASX 200 Index is neutral at this stage but with a leaning towards looking negative. The market has made zero progress since May but this wild price action that we have since seen is starting to converge. Given that the market was falling before it entered this triangle, you would assume that the most likely break from here would also be to the downside. Or from an Elliott Wave point of view, we are in a 4th wave and we need to see a final "wave 5" to finish off this weakness that started at the beginning of May. That is, at some point we are likely to see the market resume its fall to lower levels. We still eye support levels near 5600 and then down near 5500.
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Michael Gable is managing Director of Fairmont Equities (www.fairmontequities.com)
Fairmont Equities is a share advisory firm assisting Private Clients with the professional management of their share portfolio. We are based in the Sydney CBD but provide services to private clients across Australia. We believe that the concepts of fundamental analysis and technical analysis of stocks are not mutually exclusive. Regardless of whether you are a trader or long term investor, combining both methods is crucial to success. As a result, the unique analysis of Fairmont Equities is featured regularly in the media such as Sky News Business, CNBC, The Australian Financial Review, and the ASX newsletter. Contact us for a free trial of our research and information on our portfolio management services.
Michael is RG146 Accredited and holds the following formal qualifications:
• Bachelor of Engineering, Hons. (University of Sydney)
• Bachelor of Commerce (University of Sydney)
• Diploma of Mortgage Lending (Finsia)
• Diploma of Financial Services [Financial Planning] (Finsia)
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2
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Disclaimer
Fairmont Equities Australia (ACN 615 592 802) is a holder of an Australian Financial Services License (No. 494022). The information contained in this report is general information only and is copy write to Fairmont Equities. Fairmont Equities reserves all intellectual property rights. This report should not be interpreted as one that provides personal financial or investment advice. Any examples presented are for illustration purposes only. Past performance is not a reliable indicator of future performance. No person, persons or organisation should invest monies or take action on the reliance of the material contained in this report, but instead should satisfy themselves independently (whether by expert advice or others) of the appropriateness of any such action. Fairmont Equities, it directors and/or officers accept no responsibility for the accuracy, completeness or timeliness of the information contained in the report.
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