Market Wrap - 04/11/09

The All Ordinaries Index was up marginally today +0.2%.

Breadth was marginally negative with an Advance/Decline Ratio of 0.95.

In the 50 Leaders, NewHighs/NewLows were 1/12 which is quite negative.

Only six percent of the 50 Leaders were above the 10-Day Moving Average. That figure is too low.

Expect more sideways to up movement.

The rest of this week will be dominated by two events in America. Tonight the Federal Reserve meets to announce interest rate settings.

On Friday night, American jobs data is announced.

Either or both of these could have a big impact on the market, one way or the other.

The sideways action over the past couple of days is not unusual leading up to such important news events.

Market view -3rd November, 2009

Well - I backed the Melbourne Cup winner today. Woo hoo.

Stock market

The market finished virtually flat today.

New lows increased again today (11 new lows) without any new highs.

Stocks in the 50 Leaders,

* above the 10-Day SMA - 2%
* above the 50-Day SMA - 18%

This is too low - expect a bounce - but I don't think there'll be a lot in it. (I made the same call yesterday. Well, we didn't go up - but we ended flat - that's close enough? Maybe I'll get it right for tomorrow.)

Comments - 29/10/09

Yesterday's sell signal played out today. The general market picture is very weak. Medium term weakness is expected - but expect a bounce tomorrow.

Here are the 50-Leader stats:

Yesterday:

Above 10-Day SMA - 10%
Above 50-Day SMA - 38%
Above 50-Day SMA - 92%

Today:

Above 10-Day SMA - 16%
Above 50-Day SMA - 24%
Above 50-Day SMA - 88%

I'm including yesterday's figures because we have a non-confirmation on the 10-Day SMA line. That is, the figures today are stronger than yesterday.

That suggests that internal strength may not be as weak as the index absolute figures show. Expect a bounce tomorrow.


Stocks from the 50 Leaders making new 20-Day Lows - 24

Stocks from the 50 Leaders making new 20-Day Highs - 2.
(Both were defensive stocks: Sonic Health and Telstra)

The 20-Day New Lows is extraordinarily low - almost half the index.

Expect a bounce tomorrow.

50 Leaders - Wrap up, 28/10/09

Here are the 50-Leader stats:

Above 10-Day SMA - 10%
Above 50-Day SMA - 38%
Above 50-Day SMA - 92%

Stocks from the 50 Leaders making new 20-Day Lows - 13

Stocks from the 50 Leaders making new 20-Day Highs - 2.
(Yep - Telstra was one of them - the other was Wesfarmers. Both Defensive Stocks.)

Those numbers are probably low enough for a bounce to occur.

For how long is another question.

The banks were pummelled today and the candle stick charts for today look like big black bombs. That probably means a pull-up tomorrow - but the technical damage looks to have been done. This looks like Wave A of an ABC pullback for the banks.

I didn't quantify it as I went through - but subjectively I noticed a lot of completed double tops. And that also probably means a test of the valley between the tops. So a move up is on the cards. If the test of the valley results in respect - then we can look at another few days or a couple of weeks (or three or four or more) of downward movement. But I'll just go with the flow.

The number of new lows also suggests a bounce. The Turtle Traders would be going short those stocks. But only about 30% of those play out (Linda Bradford Raschke, "Street Smarts").

So the courageous should be piling in - probably at the end of today.

I think I'll go to the park and play slippery-slides with my grand-daughter for a couple of days and then see how it goes.

Quick Wrap. 26/10/09

The market was down today, 0.6%.

The 50 Leaders below the 10=day Moving Average was 36%. That's getting close to working off the overbought level.

But here's the cruncher.

In the 50 Leaders: New Highs - Three. New Lows - Zero.

This pullback doesn't look too serious at this stage.