XJO 0.23% 6,367.3 s&p/asx 200

Intriguing Proposal - Monday

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    Good Morning and Welcome to the XJO Monday Thread

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    News for Today (AEDST)

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    The XJO closed higher on Friday, although it halved the gains it had late in the day.

    On raw figures the volume (value traded) was very high on Friday,
    and with the individual daily bar closing low (after being much higher) most would expect an reversal of some sort,
    and they might be right......

    However there was some Equity Options Expiry spillover, which may muddy the waters somewhat, for volume analysis.
    Although looking across it is the second highest volume, and the highest was a combined expiry day, so it was quite high.

    Today I also put in the possible channel mentioned yesterday,
    and price did indeed move up and briefly test the line @ 5614.3 and also the supply line of the channel, before retreating.

    As is always the case when a potentially weak bar arrives, the watch begins for any follow through to the downside.
    I won't be surprised to see the Index pull back a little on Monday and retest that little congestion zone to the left again,
    but it doesn't have to....we'll see.........

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    XJO intraday using the wave chart (roughly a 10min chart, with True Range shown as a proxy for volume)
    The difficulties the Index had in dealing with that daily line across @5614 can clearly be seen,
    However, it did appear to be absorbing supply early on (during the 120 upwave),
    then the challenge appeared to be  abandoned,
    with the subsequent two waves showing a lack of demand for the upside & the Index fell away into the close for the week.

    If or when the Index attempts to challenge that 5614 line again,
    at least some of the potential resistance at that level, is likely to have been weakened, perhaps substantially.

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    Good Trading and Investing


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