Australia | Nov 18 2013
The weekly closed last week on an uptrend. The market has maintained the 5400 level for the last three weeks. It appeared last week that a correction and fall was forming however moves on the SP500 from key levels at 1755 saw record highs in the US enough to push the ASX back to an uptrend by the close. The short term daily closed Friday neutral with the market closing right on the daily stop at 5409. We continue to expect weakness with volumes low at highs and monthly resistance holding rallies. The weekly upside target is 2 points lower than last week at 5426. The weekly upside target has been falling for the past 4 weeks as markets have failed to breakout. A break of 5444 next week will lead to a break higher however daily indicators suggest a retest of last weeks lows is highly likely.
The daily short term shows a stop for Monday at 5395 with the weekly stop at 5380 and monthly stop at 5373. We predicted an increase in volume and volatility last week and we continue to see new trading opportunities this week.
The market continues to be range bound in the primary 5387 -5444 range and a break outside these ranges will lead to the next direction for the market. Currency markets are consolidating with supports under pressure and fresh lows expected. We remain neutral with the market showing signs of weakness. We continue to expect new short positions. Refer to daily reports for Traders notes and updates.
Bulls lost control early in the week for the first time in the past three weeks. Thursday reversal saw the weekly stop tested and Friday the market managed to regain the uptrend. Upside resistance can be seen to 5426 and the November monthly congestion between 5417 and 5444 continues to hold any rallies. The weekly stop at 5380 confirms this level as a key pivot for the market. A break of 5444 will see the market break all medium and long term resistance and will lead to a break out. A close above 5380 at the end of the week will maintain the uptrend.
Bears had a good start to the week with the market on a downtrend on all three timeframes for the first time since October. The daily indicates a neutral position with 5395 a key level in the short term. Bears will need to see the long supported levels at 5380 and 5373 broken to indicate new medium term shorts and weakness in the market. The important supports for next week are 5380, 5373 and 5355. A close below 5380 will see a new downtrend and possible short positions.
iQUANT FORECAST RANGE 5280 – 5426
PIVOT POINT 5380
Review of prediction from 8th November 2013 for last week
The weekly closed last week on an uptrend. The market has lacked direction for the past fortnight and rallies have been quick and short lived with a lack of volume at the peaks indicating the market is being bid up as sellers remain patient. The short term daily is on a downtrend and weakness is continued to be expected. The upper range target for next week is 5428 and is below last week’s peak at 5456. A move above 5428 will see the market overbought in the medium term.
The daily short term downtrend continues to hold with a daily stop for Monday at 5425. Last week the daily had a change to a downtrend on Wednesday however the market held support and a lack of volatility was seen intraday. We expect volume and volatility to increase this week.
The market has traded the predicted 5387 -5444 range for the last fortnight and a break outside these ranges will lead to the next direction for the market. Currency markets are falling from peaks and the SP500 has tested key support at 1755. The short term daily indicates short positions with the medium term in an uptrend with limited upside – indicating neutral. Refer to daily reports for updates.
Bulls held supports and stops and are back on trend. Upside resistance can be seen to 5428 and the November monthly congestion between 5417 and 5444 continues to hold any rallies. The weekly stop at 5387 confirms this level as a key pivot for the market. A break of 5444 will see the market break all medium and long term resistance and will lead to a break out. The daily upside target for Monday is 5463 and a break of this level will see the market extremely overbought. A close above 5387 at the end of the week will maintain the uptrend.
Bears were unable to maintain momentum and break supports. The daily remains on a down trend and bears will need to see the long supported levels at 5387 and 5373 broken to indicate new medium term shorts and weakness in the market. The important supports for next week are 5387, 5373 and 5361. A close below 5387 will see a new downtrend and possible short positions.
iQUANT FORECAST RANGE 5292 – 5428
PIVOT POINT 5387
ACTUAL 5465 – 5320
The market opened the week at 5465 extremely overbought and above all daily, weekly and monthly targets. A sell signal was given on Monday’s open and the market fell 140 points in the following 48 hours. Thursday daily support formed and the market rallied back to the 5387 weekly stop. It appeared this level would hold and new medium term shorts were initiated on Friday. By the close on Friday the shorts were stopped out as the market managed to regain 5387 and close on a weekly uptrend. The market continues to trade short term downtrend into a medium term uptrend. iQuant predicted an increase in volatility which was the highest since mid October.
Resistance remains between 5420 and 5444 and we continue to expect lower lows. Currency markets continued to fall from peaks with bounces seen in AUDUSD and EURUSD. Key level AUDUSD 0.9280 – refer to website for full report. SP500 continues to trade without upside resistance and is approaching extreme overbought conditions at 1790.
As predicted volume for the week was the highest since September futures expiry with the volatility allowing the traders and HFT back into the market after 3 weeks on the sidelines. The stop for the week was 5387 and the VWAP on the futures for the week was 5387.
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ASX200 report tracks the December ASX200 SPI. The ASX200 index is currently trading at a 14 point discount 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. Views expressed are not by default FNArena's (see our disclaimer).
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