Technicals | Jun 05 2017
By Craig Parker, asset manager, Moat Capital
Onwards and upwards we go at least for the very near term. Last week started out shaky as suggested however 5730 has turned out to be a nice little support level as can be clearly seen on the daily chart below. Also in the market's favour is the monthly chart looking to recover along an uptrend line. The weekly chart also has good support around the 5730 level although in the coming weeks I would be looking out for bearish divergence on the RSI. It will be interesting to see how the market reacts around the 60-day moving average and whether there is some resistance which, would indicate some weakness in the move up.
If we were to get back up towards the 6000 level I would be getting ready for another correction and a possible channel emerging between the 6000 and 5730 levels. All in all, technical analysis is leaning towards a possible short term recovery with all eyes on the financial sector which needs a massive recovery before it would be classified as being back in the uptrend it was previously in. I doubt this will occur as the recent move down was so strong. A short-term recovery and then I would be looking out for a lower high which would confirm a medium-term downtrend and lower for our overall market. With the S&P 500 continuing its record advance albeit with clear bearish divergence on the weekly RSI and Gold also continuing to advance the outlook is very mixed. A sneeze in the white house and the S&P 500 could revolt to the delight of Gold buyers.
ASX200 daily
ASX200 weekly
ASX200 monthly
ASX200 Financials ex-REITs weekly
S&P500 weekly
Gold weekly
Authorised Representative Sentinel Private Wealth AFSL 344762
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