Market Comments 17/8/2010

The All Ordinaries (XAO) had a solid day today, up +0.84%. The Advance/Decline Ratio was also solid at 1.7. All S&P Industry Sectors were up, with the Industrials a stand-out, +2.2%.

Risk Aversion was dominant with the Small Ordinaries up +1.5% and the Fifty Leaders +0.8%. That is also positive for the market.

The weakest sector today was Energy, +0.1%. Woodside, after a good short term run-up, hit the resistance of the 150-Day Moving Average and dropped back, dampening the overall performance of this Sector. That may or may not be an indication of future direction. Another down day tomorrow (which I doubt) would put the rally of the whole market in doubt.

Gold has had a great run recently (see prior post this morning). Today it ran into a triple whammy. Resistance at the 50-Day Moving Average, the 20-Day high and recent horizontal resistance set back in mid-July.

Today's candle was a bearish engulfing candle, occurring at significant resistance. Expect more falls in the short term.

Gold often trades inversely to the XAO. So that may be a pointer to further rises on the general market.

Cheers

Red