Trading Day

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The S&P/ASX 200 Index closed down almost 100 points or 2.43% to 4060 today, after falling sharply in the morning and following the news of the death of North Korean dictator Kim Jong Il.

However, its not the death of a despot that has driven markets down. As I suggested last week, the market appeared on its way to 4000 points, the intersection of the dominant downtrend from April and the rising support when ever the market breaks the psychologically important 4000 point barrier:

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In after hours trading, the SPI futures are steady before the European open.

Japan’s Nikkei 225 was similarly affected, falling almost 1% to 8329 points, whilst the volatile Hang Seng fell over 2% to 17908 points, but the Shanghai Composite continues its downtrend after breaching support earlier this week, currently down 1.8% or 40 points to 2184 points.

Asian markets initially had weak leads from the US and Europe, with the latter closing down around 1% across most bourses. The UK FTSE was barely off, down 13 points to 5387 points, whilst the German DAX was dragged down 0.5% to 5701 points, oscillating around its short term support area. Both look set for 1-1.5% falls tonight.

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The Euro (EUR/USD) is just above 1.30 against the USD and is currently trading at 1.3075, as the USD Index continues to show strength, almost climbing back above its recent one year high to be just above 80 points:

As the US dollar rallies, that means the US equity markets weren’t that good, although better than their European counterparts, as the S&P500 actually closing up 0.3% to 1219 points, still attempting to get back above short term support at 1220.

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The AUD slipped again today, but is still proving resilient, now at 99.23 cents, whilst WTI crude fell almost 1% today, as risk comes well off, and is currently trading at $92.60 USD a barrel, possibly retracing back to support just above $80 a barrel:

Gold fell again today after a volatile weekend trade saw the shiny metal regain to just over $1600 USD an ounce before falling to below $1585, where it remains under its long term trendline. In Australian dollars, the shiny metal effectively was stable at $1601AUD an ounce.

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Movers and Shakers
It was unicorn hunting season on the bourse today with red blood splattered across broker’s screens (whilst green figures popped up across the hunters cash accounts) The main spill was due to the broad sell off of the consumer discretionary sectors, down some 4 percent, following on from the terrible Friday due to JB Hi Fi (which fell another 7% today). This time it was Billabong (BBG), which was assaulted (and I mean assaulted) today falling by nearly 50% or $1.61 to just above $2 a share, falling below support at $3 and its initial share price ($2.30) back in 2000.

It’s now got a 10% trailing dividend yield if that’s any comfort.

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The banks were all sold off, ANZ down 1.4%, still in a trading range, Commonwealth (CBA) was off 1.7%, National Australia Bank (NAB) down 1.2%, whilst Westpac (WBC) was the worse off, down over 2%

Macquarie (MQG) was also hit, down 2.5%, whilst healthcare favourite Cochlear (COH) was only slightly hurt, down 0.4% in the general carnage.

Its “twin” CSL followed the market and fell over 1.5%, as it hits solid resistance at $32.50

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Telstra (TLS) fell over 1% but still remains in an uptrend, after being slightly overbought recently.

To the resources, BHP Billiton (BHP) remains depressed falling 2.5% meanwhile its “twin” Rio Tinto (RIO) suffered the same today. Is there any more downside to these market darlings?

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Gold miner Newcrest Mining (NCM) almost fell 2%, and post market announced a revised production guidance some 6% below the original provided due to disruptions.

Rounding out the ASX8, Fortescue (FMG) fell almost 4% continuning its reversal from a somewhat bullish pattern, whilst Woodside Petroleum (WPL) did almost the same after announcing further delays in its Browse Basin leases arrangements.

Defensive stocks Wesfarmers (WES) and Woolworths (WOW) were hit hard too, the former down nearly 3%, the latter over 1.3%, with their relevant retail arms (Bunnings for WES, Dick Smith and Big W and others for WOW) suffering the same shock to the overall retail sector, which looks like this:

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Looks like the Shanghai Composite doesn’t it? Funny considering that’s where most of most of our retail goods come from.

www.twitter.com/ThePrinceMB

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