Preprandials. Thursday 7/4/2011

The All Ordinaries today (XAO) was down marginally -0.12%.  The market today hit right on resistance and then retreated - but nothing dramatic.

Seven out of ten S and P Sectors were down today.

Of most note was the Advance/Decline Ratio for the 50 Leaders which came in at a bearish 0.55:1.  

The big winner today was the Energy Sector +0.8%.  The best performing blue chip stocks today were all from that sector: Worley Parsons +4.52%, Origin Energy +2.38%, Santos +1.13%.   Financials registered as being up today, but the percentage rise rounded off at 0.0%.  The only other sector up today was Health +0.1%.  Small Ordinaries was down in line with the general market -0.1%.

Like yesterday, the market spiked higher in the after-market auction.  Is that significant?  I haven't got a clue.  :)  But it is a bit odd.  It made today's final figure look better than it was - just like yesterday.  Is somebody/bodies trying to hold this market up a little longer so that they can carry out their distribution plan?  Maybe.

Technical Comment on the Australian Market:

1. XAO is at horizontal resistance formed by the February 2011 and April 2010 highs.  A break higher here would be very bullish.
2. RSI at 67.9 is close to the high danger zone of 70.
3. Stochastic is overbought and flattening out.  Caution
4. Steep uptrend line from the March 2011 low has been broken to the down side.
5. MACD Histogram was down today for the first time in sixteen days.  Caution.   
6. Significant support in 4900-4960 area.

Today's action was again indecisive for bulls and bears.  A steep fall away from resistance or a solid break above resistance should determine future short-term direction.  Just my opinion.  What's yours?  Please engage in your own research and make your own decisions.

Good luck

Red