Australia | Oct 27 2013
The weekly uptrend has ended and a new downtrend has started with a close below 5424.The market is at the upper end of the short term range and the RSI is at elevated levels. Last Wednesday’s fall reversed the RSI from extreme levels. The weekly outlook shows limited upside resistance to 5439. The downside shows support to 5281.
The daily short term uptrend continues to hold. The daily stop for Monday is 5395 and a close below this level on Monday will see the market on a downtrend on a daily basis. The weekly upside target is 5439 and any move above this level will put the market at extreme overbought levels again. The daily uptrend continues to trade into the weekly downtrend.
The market continues to break higher and a new daily downtrend and close below 5387 next week will confirm a peak. Volumes remain low as sellers remain patient. Short term momentum continues to push the market higher. The daily will indicate the peak and any move to a daily downtrend will present a selling opportunity. Refer to daily reports for updates.
Bulls held the lower range last week and maintained momentum however the trend changed to a downtrend. The weekly downtrend will be reversed with a close above 5387 at the end of the week. The bulls see limited upside resistance above 5439 and a break of this level may see another breakout.
The daily also shows limited upside resistance above 5440 and the bulls will need to maintain the momentum.
Bears have regained control with a new weekly downtrend. Low volumes see sellers remaining patient and the daily uptrend continues to hold. A new daily downtrend may see volumes increase and a decline in prices. The important supports for next week are 5369, 5350 and 5319. The Weekly stop is +2 from the close indicating there is increased downside risk.
iQUANT FORECAST RANGE 5281 – 5439
PIVOT POINT 5387
Review of prediction from 18th October 2013 for last week
The uptrend holds for a second week with the market closing on its highs. The market is overbought in the short term and has cleared long term resistance. The market has been testing long term support on the monthly and has held two sell downs. The weekly outlook shows upside opening up with an upside target at 5481. The downside shows resistance to 5313 and a break below this level may see a rapid sell off. This indicates there is high risk in the market next week. The trend and momentum should see prices continue to rise however the stop for next week is 5424 and the market will need to close +100 points to hold the weekly uptrend. It is likely that another peak in the market will be seen this week. Volume was higher last week although volume decreased as prices rose.
The short term daily stop for Monday is 5298 and a close below this level on Monday will see the market on a downtrend on a daily and weekly basis – Monday has daily upside to 5335. The market has bounced strongly from oversold conditions and we favour consolidation. Any strength from here will put the daily RSI at extreme levels.
The market has broken out and there is limited support for the market under 5300. Volumes on the rally indicate there is a high risk of a pull back next week and the stop confirms the risk is to the downside. We saw limited volume at the lows a fortnight ago and we are now seeing limited volumes at this peak. The daily will indicate the peak and any move to a daily downtrend will present a selling opportunity. The trend holds on all three timeframes and the daily and weekly are both at risk.
Bulls held the sellers on Monday and held the market neutral before a rally on Friday. The bulls did well to hold on to the trend but face a 100 point hurdle next week to maintain the trend. Upside resistance can be seen at 5345, 5368 and 5392. A close above 5424 next week will hold the weekly uptrend. Upside resistance can be seen to 5481 and a break of this level will lead to a breakout. The bulls have limited support below 5300 and 5200 to 5250 shows support in the medium term.
Bears tried to pressure the market on Monday and held the market flat for the majority of the week. Volumes indicate sellers are remaining patient. The important supports for next week are 5321 and 5313. The stop for the week is +100 from the close and it is likely a medium term peak will be seen in the market this week. A new daily downtrend will be the key to entering new shorts. Refer to daily reports for updates.
iQUANT FORECAST RANGE 5313 – 5481
PIVOT POINT 5424
ACTUAL 5316 – 5396
As predicted the daily momentum continued and the market finished the week with a 1% gain. The market started the week at the lower weekly range and held. Multiple levels of support could be seen at the low and the market rallied for two days. Wednesday we predicted a medium term peak at weekly resistance near 5392. A sell down Wednesday afternoon pushed the market back towards the support and tested the daily uptrend. Thursday saw the daily uptrend hold and the market moved higher for the remainder of the week just missing out on a new high. Daily uptrend held everyday of the week.
The weekly stop at 5424 held despite a 60 point gain for the week. Short term the market is at the upper range with the RSI at elevated levels. Volumes were the lowest in the last four weeks. Market is trading short term uptrend into a medium term down trend with a new daily downtrend highly probable next week.
The predicted downside range held the market and a new weekly downtrend starts this week.
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ASX200 report tracks the December ASX200 SPI. The ASX200 index is currently trading at a 7 point premium to the futures. All levels in this report refer to the ASX200 SPI futures.
The information contained in this communication is general information only. Any advice is general advice only. Neither your personal objectives, financial situation or needs have not been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice. Iquant Systems Pty Ltd (CAR No.435627) is a corporate authorised representative of Avestra Capital Pty Ltd (AFSL No. 292464).
Copyright © 2013 Iquant Systems, All rights reserved. Republished with permission.
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