Technicals | Jun 18 2018
By Craig Parker, asset manager, Moat Capital
Look out for 6150 ahead. Fridays move suggests there is some serious bullish impetus back in the market with such a large bullish range. This doesn’t change the picture from what I have said the past couple of weeks with a move back towards the 6150 level. On the positive side the Financial sector is looking to have that short-term counter trend up in its primary downtrend that I mentioned recently. This should help provide some impetus for our overall market moving back towards the 6150 level and perhaps slightly above.
In saying this I wouldn’t be betting against the primary downtrend in the Financial sector failing just yet so the reprieve to the upside could be short term only. What I am a little concerned about from a technical perspective is the ASX 200 monthly chart and the very Bearish divergence on the RSI indicator. You can’t always count on this indicator, but it is suggesting some medium-term headwinds. Another important sector in our market is the Materials sector which for the short term is looking a little shaky with a recent peak lower on the daily chart. Hopefully our dollar dropping below 75 will help support this sector’s recent advance. Even if the Materials sector does cause some headaches for our overall market I think a move up in the Financial sector would overcome this in the short-term.
In other markets the Dow Jones Transportation Index is looking very bullish which should please the Dow Theorists out there. Gold is looking Bearish and Oil has dropped which should help with easing the burden on household expenditure and add to some consumer spending. At least that’s what the economists are hoping for. Enjoy your week!
ASX200 daily
ASX200 monthly
ASX200 financials ex-REITs daily
ASX200 materials daily
Dow Jones Transport Average daily
Authorised Representative Life Plan FP AFSL 449658
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