No fancy stuff tonight. Just plain old trend channel. Boring. Boring. Boring.Yeah - I know it's boring - but it works.
XAO has been in a a narrow uptrending channel for about a month.
A break lower still has to contend with solid support at around the 4600 area. If that breaks, the market looks like going a lot lower.
Seasonal factors (October effect) would suggest a test of the 4600 area.
But today's action was not a convincing day for the bears despite the reversal from earlier strength. UpVolume/DownVolume Ratio was good at 1.9:1 while Advancers/Decliners was at 1.24:1. That gives a bullish reading of 0.65. A reading less than 0.9 is considered bullish. So today's figure is quite strong.
I think we're looking at a few more days of cyclic weakness - but nothing of great significance.
If the market goes below 4600, then all bets are off.
Be patient.
Cheers
Red
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