XJO 1.74% 6,789.6 s&p/asx 200

Weekend Charting and Chat. 1/2 Feb. 2020

  1. 8,864 Posts.
    lightbulb Created with Sketch. 2554
    Yesterday in Australia:
    https://hotcopper.com.au/data/attachments/1958/1958340-1ba33f127d2992e9db557dcdf2906584.jpg

    XJO was up a little on Friday, +0.13%. The past three days look like a bear flag, so expect more downside.

    All indicators are turned down and giving "do-not-buy" signals.

    A major support zone lies around the 50-Day EMA and a major horizontal support line. That's where this seems to be headed.

    Overnight:
    https://hotcopper.com.au/data/attachments/1958/1958342-3f9ad7a73b66571770781cf9e973f5ab.jpg

    American indices fell heavily. Dow Jones -2.09%. SP500 -1.77%. Nasdaq -1.59%. Small Caps -2.31%

    Volumes are increasing as the indices fall. That's usually a sign that panic selling is at hand. That's when we can expect a move back to the upside.

    sp500:
    https://hotcopper.com.au/data/attachments/1958/1958348-9ae6d660df2bb88760a03b63c85bba06.jpg

    SP500 is down to a dual support area, 50-Day EMA and horizontal support. So we could get a bounce here after Friday's wide-range, heavy volume day.

    Some positive divergences are starting to show up (MACD Histogram, Stochastic, ROC) but we need more evidence.

    Yesterday, I noted that we rarely get a double dip below the lower Bollinger on the MFI without a bounce. We still need to see a move back inside the lower Bolly to suggest a bounce is in place.


    In the meantime, we just have to wait this out.

    Commodities:
    https://hotcopper.com.au/data/attachments/1958/1958351-a93b248fbe53a0616cee85267f43a3b2.jpg

    Commodities continue to get more and more oversold. Commodities Index -0.82%. Base Metals -0.56%. Energy -1.72%. Gold (safe-haven) +0.58%.

    We'll know when this plunge is over when RSI rises back above 30.


    CNN's Fear and Greed Index:

    https://hotcopper.com.au/data/attachments/1958/1958354-52ead6d6aeb7b01d018c67f56494f9ed.jpg
    The FnG Index is now registering "Neutral" and nudging into the Fear Quadrant. This still isn't enough to suggest that this pull-back is over.

 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.