Technicals | May 28 2018
By Craig Parker, asset manager, Moat Capital
My apologies to readers of my report last week as I mentioned that I would be looking to see the ASX 200 move back towards the 200-day moving average when in fact I meant the 60-day moving average. The same but opposite can be said for my comment on the Australian dollar. Not that there is a great divide that separates the two averages in both cases but thought I should clarify. I must’ve been having a colour blind day. Again, apologies for any inconvenience.
As far as the last week goes we had a slight move back towards the 60-day moving average and I would expect to see some support once this is achieved. By this time the 200-day moving average will have converged with the 60 day and perhaps we will see the commencement of another shot at the 6150 barrier. Ideally before this happens I would be looking for some consolidation around the 6000 level, preferably between 5950 and 6050.
On a positive note for equities is the US 10 Year Treasury Note falling back below 3. How long this will last is anyone’s guess, but it has had a positive effect on our listed property trust sector. Another chart I will be monitoring is the Financial sector daily chart which has formed a support level with 2 troughs and perhaps a 3rd one forming. If the 3rd doesn’t hold then it’s likely the Financial sector is looking at another 5% move down. Hopefully this current support level can hold and provide some consolidation before a short-term recovery. Enjoy your week ahead.
ASX200 daily
ASX200 financials ex-REITs daily
ASX200 listed property daily
US ten-year yield daily
Authorised Representative Life Plan FP AFSL 449658
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