Trading Day: 15th July

The S&P/ASX 200 fell again on the open and has stabilised, now 0.38% or 17 points lower just after midday to 4473 points.

Other Asian markets are mixed, with the Nikkei 225 up 0.25% at 9960 points, and the Hang Seng down 0.37% at 21,858 points.

Other risk assets are also mixed, with the AUD steady at 1.0737 against the USD, whilst gold steadies at $1586 USD an ounce. WTI crude is up slightly after falling last night, now at $96.30 USD per barrel.

Movers and Shakers
It’s a hard time being a stock picker – mainly red across the board, but mixed within sectors. The banks are generally being sold off, with ANZ down 0.7%, CBA down 0.6% and WBC down 0.58%, but NAB is up this morning almost half a percent.

BHP is down 1.79% – because of its acquisition of Petrohawk? Seems expensive at over 65% the recent share price. Conversely, RIO is up 0.65% providing some buffers to general sell off across the index.

The winners amongst ASX200 stocks include NRW Holdings (NWH) up 5%, and Transpacific (TPI) up 3.5% – whilst Resmed (RMD) gets a boost, up 3.5%

The biggest losers are a mix too – Aristocrat Leisure (ALL) down almost 4%, Adelaide Brighton (ABC) down 3% and rare earth miner Lynas (LYC) down 2.8%

Daily Chart
The daily chart shows this correction is down to critical support at just below 4500 points (and depending on your timeframe, technically at 4475 or 4450). Direction is slowing down though – this is not a clear downtrend, with buying support coming in whenever it crosses the 4500 mark. This is a bottom pickers market for long-only investors, but remember only monkeys pick real bottoms – this could be like catching a falling knife.

Daily chart

Weekly Chart
The weekly chart is more troubling – that large red bearish candle is about to close below support – i.e we are back to where we started in August 2010, before The Bernank started pulling levers. Local pundits are calling for rate cuts to arrest this decline. As we come into earnings season, we’ll see if the rest of the market will follow David Jones’ “shock” move.

Weekly Chart

My long term system is still displaying “don’t go long here” signals with a confirmation if weekly price closes below the 4475 point level changing my market stance from “sideways market” to “bear market”.

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  1. Gonna be an interesting end to the week.

    ASX 200 now 4458, just above “support”. Let’s see if it holds, wit 1 hour of trading left for the week.

    Also Gold and Silver both possibly building Head and Shoulder tops on the short term charts over the past 48 hours.