The S&P/ASX 200 just closed in positive territory today, after a strong morning session. The index is up 11 points or 0.3% to 4307 points. In after hours trading, the market is slightly below 4300 points.
Asian markets experienced stronger gains, following EU/US risk markets, with the Nikkei 225 closing up 1.1% at 9060 points whilst the Hang Seng closed up 1.25% to 20792 points.
In other risk assets, the AUD is up strongly to 1.0714 against the USD, whilst WTI crude rallied to $89.01 USD per barrel. Gold has steadied to again after sharp movements overnight, now at $1818 USD an ounce.
Movers and Shakers
It’s mixed across the board on the ASX, with Newcrest (NCM) dragging the index down, BHP-Billiton, Telstra and the banks providing the bid again providing the bids.
Overall the banks were mixed, with NAB and WBC posting around 0.5% gains, the others very minor losses. Suncorp (SUN) retraced slightly whilst Macquarie (MQG) made over a percent – the day traders are in swing.
BHP Billiton (BHP) put on 0.33%, whilst RIO did better at 0.77%. The retailers had a good day, with “unreliable” ABS retail figures showing a surge, Harvey Norman (HVN) was flat however.
The Charts
Strong resistance at 4300 points – the high reached during the rebound rally from the epic correction of early August – is being tested. The long upper tail on today’s candlestick shows how the market is trying to break through this area.
However, the sniff of QE may be too much for risk takers – all risk markets are rising together on the possibility of easing (in fact the correlations are startling and have overloaded this risk-based trader).
The weekly chart is again, revealing. Note not only the strong support at 4100 points, now tested for four weeks in a row, but that all of last week’s action is above the previous three. Target resistance just below 4500 points remains.
I still contend this is a bear market (both technically and using a multi-factor macro model), and only another layer of botox or similar “creme” can get it back to the nominal high just below 5000 points.