After a big opening, the market drifted down all day to finish up 0.6% at a new rally high from March of 4862.5. The market seems intent on heading for 5,000 (much like the Dow seemed intent on 10,000).
In the Industry Sectors, Materials and Industrials took the honours, both up +1.0%; while Telecommunications again tailed the field, -1.0%.
Breadth was positive. Advance/Decline Ratio: 1.56.
However, Declining Volume shaded Advancing Volume with the AdVol/DeclVol Ratio at 0.94. It is rare to see these two measures out of sync and suggests underlying weakness in the broad market despite the rise in the XAO. Following on from the overbought status of the 5-Day Average of the Advance/Decline Ratio mentioned in yesterday's notes, it suggests that the market is set for a sideways to down consolidation, or perhaps a significant correction.
The Small Ordinaries underperformed yesterday, up 0.4% - adding to the less than positive tone in yesterday's market. Strength in the Small Ordinaries is needed if this market is to keep heading higher.
The Ozzie Dollar broke above 92 cents today - that's where I've thought for many weeks that our $ was headed. There is a Technical Analysis argument that our $ is headed close to parity.
So long as our $ continues to show strength and international money continues to flood into Australia, our stock market should remain strong.
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