Iron ore is headed for another test of short-term support at $90. Breach would signal another decline, with a medium-term target of $80 per ton.
The ASX 300 Metals & Mining index retreated this week and is expected to test long-term support at 4100. Breach would complete a head and shoulders reversal, with a target of 3400.
The Financial sector is testing resistance at 6500, with short candles indicating hesitancy.
With building approvals falling, expect housing to remain a drag on growth in the medium-term — unless the RBA & APRA go all-in on interest rates and macro-prudential to rescue the housing bubble.
The ASX 200 is testing resistance at the 2007 high of 6800. Short candles warn of stubborn resistance. Reversal below 6400 remains unlikely but would signal a decline to test primary support at 5400.
We maintain exposure to Australian equities at 25% of portfolio value, with a focus on defensive and contra-cyclical stocks, because of our bearish long-term outlook.