By Chris Becker
The earnings season is slowly winding down (but the downgrades are mounting up), and the ASX200 gained 0.4% today or 15 points to 4359, all on the back of what looked like short covering on the Chinese equity markets. I’ll take a closer look at the bottom of the post for a full roundup including technical analysis of the bourse itself. The Nikkei 225 was instead down 0.6%, with the Hang Seng having a scratch day, the Shanghai Composite is up nearly 1% to 2073 points – have we found a bottom?
Maybe, maybe not, but here’s a long term chart of the “Eiffel Tower” vs the Nikkei 225, with their peaks matched (the Japanese stock market peaked in 1989 at nearly 40000 points, its currently down 76% since):
Aussie battler continues to err, battle – trying to lift itself off the floor against everything, as it remains below 1.04 against the USD, whilst the Euro/USD cross is battling King Dollar and currently trading just below 1.25.
The US Dollar Index is slowly coming back after breaking its daily flag pattern recently, now at 81.7 points:
Gold (USD) is slipping after its big breakout recently, as traders await the “no news is bad news, but good news on the economy is bad news” chat from Helicopter Ben on Friday. The precious metal/pseudo currency is now at $1660USD – but in AUD terms since the battler is weakening it remains static at over $1609AUD per ounce
Australian Stocks
Earnings season is slowing down, thank Dog, as we continue to cover the major movers including updated valuations, Risk Scores, macro evaluations, suggested portfolio allocations, position signals and the lot in next edition of Macro Investor.
In the ASX8, the pause button is on some divisions of Megabank (except maybe CBA, which looks like being king hit by the shorters) whilst Newcrest (NCM) was sold off and bid up intraday, there’s still not a love for materials stocks just yet. Again, pause, wait and see seems to be the main motive.
On to the index – which seems to be finding some weak support at 4340 points in the short term, and remains in an holding pattern:
These daily updates need to be placed in context with the longer trends and drivers amidst the overall technical picture, where Former “Trading Week” readers will find it reborn as “Technicals“, published 8.30am each Monday morning.
Chris Becker is an investment strategist at Macro Investor, Australia’s leading independent investment newsletter covering stocks, trades, property and fixed interest. Each week Macro Investor publishes tables on the top ten most undervalued and overvalued stocks on the ASX. A free 21-day trial is available at the site.
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