By Chris Becker
These daily updates need to be placed in context with the longer trends and drivers amidst the overall technical picture, so head to Macro Investor for a free trial. Former “Trading Week” readers will find it reborn as “Technicals“, published 8.30am each Monday morning.
Another fun, almost green day across the board as the RBA announced a hold on the cash rate – with the ASX200 up almost 0.5% or 19 points to almost breach 4300 points. 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 did better – up nearly 1% and still within that trading range I mentioned yesterday, although my short term trading system continues with its initial long, a break above 9100 points would signify a bigger move ahead. The Hang Seng scratched a few points, but the Shanghai Comp is being a little disappointing, currently flat at 2152 points.
On currency markets, the Aussie spiked above 1.06 ever so briefly when the hold news came out, but has settled back to 1.0575 going into the evening session, whilst the Euro/USD has slipped below 1.24 with the USD having sold off in the last couple of days, now slowing coming back at 82.32 – I reckon if it breaks below 82 this rally will continue a little while longer, but it really needs legs below 81 to get things moving into a proper rally:
Gold (USD) is becoming more bullish than either the “golden” currency or the “battler” – after it climbed all day yesterday, it is gravitating around the $1610USD per ounce level. It also continues to bounce back in AUD terms, now at $1523AUD per ounce .
Australian Stocks
In case you missed it, earnings season has begun – so I’ll give you the quick view of what’s going at the index level, but you’ll have to read my daily roundup to see whats’ what with the reports. The ASX200 has broken free of the temporary resistance at 4270 points and looks set to continue on its way up to 4400 points, with support below just above 4200 points:
As I said yesterday, I did a larger writeup and analysis in this week’s Technicals at Macro Investor, where I still reckon you can find better risk/reward ratio trades and positions in other shares, sectors and indices in this risk-on rally.
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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