Morning Coffee, Tuesday, 26 April, 2011

In America:

1. Dow Industrials -0.21% 
2. Dow Transports +0.19%
3. SP500 -0.16%
4. Russell 2000 -0.17%
5. Nasdaq100 +0.27%

Comment: Momentum continued to slow in a dull trading session.  Results were mixed.  The Materials Sector was down -0.77%.  That's a minus for Australia.  The Banking Sector was flat +0.02%.  Semi-conductors was flat +0.05%.  

Europe - closed for Easter Monday.  Previous session results were:

1. France +0.43%
2. Germany +0.64%
3. London -0.07%

EWA (Australian Shares ETF traded on the New York Stock Exchange) +0.11%, The Australian Dollar was down -0.26% to finish at 107.22.  

Technical Comment on the American Market:

1. The Dow Industrials finished at 12479.9
2. The Index is above both the 13-Day the 50-Day MAs.  Positive.
3. Indicators:
• Slow Stochastic 95.9.  Overbought
• The 13-Day MA is above the 50-Day MA.  Positive
• RSI above its mid-line, now 61.2.  In the caution zone (60-70)
• MACD Histogram above Zero.  Positive.  
• CCI +130.52 and dropping.  Caution.
4. Volume was lower than the previous two days - demand is easing.  (This may be an Easter effect - or may be more significant.)

In the past 24-Hours Gold in Ozzie Dollars was flat -0.11%.  That's a positive for our broad market.  

And the price of oil remains high - hovering above 110 for West Texas.

Recently I commented on how low the VIX Index had fallen - and that complacency was too high.  There's an excellent blog called VIX and More.  The writer goes into the complexity of the VIX to much greater degrees than I can hope to do.  He's noted that when the VIX:VXV Ratio is below 0.9, the market tends to fall.  That ratio is currently around 0.8.  Draw your own conclusions.  (VIX relates to 30 Day Volatility, VXV relates to 3-month volatility.)

The Australian market is closed today, so we have to wait on another day of overseas trading before we can take any action.

Good luck

Red