Technicals | Jun 12 2018
By Craig Parker, asset manager, Moat Capital
Technically not a lot has changed since my comments of last week suggesting some support for the S&P/ASX 200 around the 60-day moving average. Now the question is will wee see a retesting of the 6150-resistance level which was reached in January 2018 and retested as recently as May 2018. The recent move up in the ASX 200 has been fueled by the Materials sector which you can see on the respective monthly chart below that it has had a decent resurgence. Technically the Materials chart is illustrating some strong Bearish RSI divergence although this could take some weeks to play out before a correction.
The key chart again is of the Financial sector and more specifically the Banks index which you can see below has crossed below a 10-year uptrend line some time ago. On the bright side the Banks have taken a hit and have been trending down for some time now and are due for a counter trend up soon. Also, the Banks index has some support not too far off which, would be a welcome reprieve and positive for our overall market, albeit in the short term.
The S&P 500 is gathering some momentum above its 60 and 200 day moving average support which is a good sign for our market. As mentioned previously I believe this will be more than likely a short-term positive before the longer term economic fundamentals and impacts on our banking sector and financial services sector is played out. The most recent high-profile player in the financial services sector is the Dover group of over 400 advisers which were shut down overnight leaving advisers without a home and ability to provide their clients with financial advice. The turmoil in this sector is getting out of control. Enjoy your week.
ASX200 daily
ASX300 banks weekly
ASX200 materials monthly
S&P500 daily
Authorised Representative Life Plan FP AFSL 449658
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