Strong day today on the XAO, nothing extraordinary, up a bit more than 0.7%.Advancers/Decliners, Up Volume/Down Volume were congruent with a strong day.
Small Ordinaries were stronger (+1.1%) than the 50-Leaders (+0.7%). So punters were willing to take risks today - what you expect on a strong day.
The XAO moved to a new 20-Day High today - setting up a "Turtle Soup Plus One" on the Australian market. To complete the formation, the XAO must move below the low of six days ago - 4731.
The only anomaly I can readily see is between the A/D Thrust and Price on the XAO - a clear negative divergence. The A/D Thrust sometimes acts as a leading Indicator. Looking back to the recent high mark, the XAO topped out on 11/1/2010. The A/D Thrust topped out at the beginning of January 2010 and showed a clear divergence from price by the 11/01/2010. So this market deserves close watching for a major reversal.
The usual Technical Analysis methods, however, are bullish. So - I'm going with the flow until I see some price action which melds with the couple of warning signs I've given.
The candle on the American Dow Jones last night was a doji - which represents indecision. A big black candle tonight would indicate a reversal is in place.
There are plenty of cycles coming due around now - I'm not a great fan of cycle theory - but I always keep an eye on them just in case. It pays to be wary.
Cheers
Red
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