The first day of spring. And what a way to enter the new season. The All Ordinaries (XAO) was up 2%. Not bad.
Does that take us into bullish territory? Depends on your time scale.
Looking at the medium term (weekly chart above) the chart is still below the 30-Week SMA. The chart still hasn't made a new high. The MACD is flatlining. The RSI is still below 50. The Slow Stochastic still hasn't broken above its signal line.
So - have I deflated bullish expectations enough?
NO?
Well - have a look at the % of the 50-Leaders above the 10-Day SMA. It has now hit 90%. That's overbought.
However, this thrust upwards has a lot of oomph behind it. That's a technical term for momentum. The UpVolume/DownVolume ratio today hit 4.9. On Monday it was over 6.
A reading over 5 is rare. So we now have two days out of three where that magical number has been exceeded or approached.
This thrust upwards is particularly strong.
My conservative instincts tell me that the market is in need of a rest. I'm expecting a sideways to down session tomorrow and maybe the next day - just so the market can get its breath. If I was young and carefree - I'd say - this will continue on and on. hmmmm. Maybe tomorrow will be up - but then expect a couple of days consolidation. Nothing goes up for ever.
This market is ready for some consolidation - but - after than expect more upside.
Please remember, I'm just a mere mortal and an old doddering one at that so take everything I say with the proverbial grain of salt. Do your own research.
Cheers
Red
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