In the first hour of trading today there was nothing particularly that I could see that the Australian market would have a strong day. But it did, up 1.2% after the Sp500 was up 0.78% in America.In the first hour, trading was contained by the recent tight trading range of 4800-4850. The XAO rose to resistance around 4850 and then retreated.
Volume in the first hour was about average for the past five days. That is often a sign of a trendless day. But, the market ended with a volume of 1.6 Billion shares traded, the highest since 30 October 2009. If you remember, that was close to the end of the October sell-off.
So, in recent history, such a volume is significant. The question now is - Does this represent the start of a new up leg, or the end of this rally from February.
I have a "last gasp" trend-line marked on today's XAO chart. If the market clears that - then we are going much higher.
If we get a solid black candle tomorrow - all bets for the bulls are off.
In the meantime - the XA0 broke above horizontal resistance at 4850 today. Classical support and resistance theory suggests we are going higher. That is supported by the strong volume today.
I wouldn't be selling out on today's action. :)) But a couple of down days - and I'd be hedging my long position.
Cheers
Red
No comments:
Post a Comment