Postprandials, Thursday 12/5/2011

That last candle looks UGLY.  So ... a frog about to be kissed by a princess is ugly.  :)

Let's take a look at the stats:

• XJO (ASX200) -1.8%
• XTL  (Twenty Leaders) -1.8% 
• XFL (Fifty Leaders) -1.8% 
• XFJ (Financials) -1.5% 
• XMJ (Materials) -2.6% 
• XSO (Small Ordinaries) -1.8% 

The best performing Sector today was Telecoms -0.2%.

Technical Comment on the ASX200 Market:

• The Index is below 50-Day MA and the 13-Day MA.  Negative. 
• Indicators: 

1. Slow Stochastic 12.6.  It continues in the Oversold region
2. The 13-Day MA is above the 50-Day MA.  Positive 
3. RSI  38.9.  In the Caution zone if you are short.
4. MACD Histogram below Zero.  Negative.  
5.  MACD below the Zero line.  Negative 
6.  CCI -110.8 .  Back below -100.  Look for a rise above -100 for a buy signal. 

Positive divergences are beginning to appear between the indicators and the index chart.  These mean zilch until a hook up starts to occur.  But it is promising.

Volume today was well above average - in excess of 1.5billion shares traded for the All Ordinaries.  That's the heaviest since late March.  Panic selling?  Maybe.  But in the middle of March we saw a series of days higher than that and two days in excess of 2billion.  So, today was bad.  But we might be looking at worse.  

Final opinion:  we're not far off a medium term bottom.

Good luck

Red