Tag: ASX 200 Materials

ASX 200 Financials broke through resistance at 5900/6000 while bullish divergence on Twiggs Money Flow signals buying pressure. The primary trend remains down but it appears that a base is forming. I remain wary of banks because of declining house prices but you can’t argue with the tape. A higher trough on the next correction would confirm a reversal.

The ASX 200 shows another hanging man candlestick at 6200 on the weekly chart, signaling hesitancy. The primary trend is down and the index is due for a correction soon. A higher trough would reverse the down-trend but there is a lot of uncertainty in global markets.

The Materials sector is retracing to test its new support level at 12500 after meeting resistance at 13000. The primary trend is upward and breach of 12500 is unlikely.

I remain cautious on Australian stocks and hold more than 40% in cash and fixed interest in the Australian Growth portfolio.

The Materials sector (18.5% of the ASX 200 index) continues its advance, buoyed by a temporary iron ore shortage and positive spin on US-China trade talks. The higher trough on Twiggs Money Flow below confirms buying pressure.

ASX 200 Financials (31.4% of the main index) are testing resistance at 5900/6000 but remain in a primary down-trend. Declining house prices are a significant headwind. Respect of resistance would strengthen the bear signal, while breakout would warn that a base is forming.

The ASX 200 is likely to test the 2018 high at 6350 but remains in a bear market. Another test of the former primary support level, at 5650, is likely. A higher trough, at that level, would reverse the down-trend.

I am cautious on Australian banks and hold more than 40% in cash and fixed interest investments in the Australian Growth portfolio.

The ASX 200 has been buoyed by a temporary spike in iron ore prices. Materials (comprising 18.5% of the main index) broke through resistance at 12500, signaling a primary advance. A higher trough on Twiggs Money Flow indicates buying pressure.

The ASX 200 encountered resistance at 6100 but the rally could go so far as to test the 2018 high of 6350. We remain in a bear market. Only a correction that successfully forms a higher trough would reverse that. Expect another test of the former primary support level at 5650.

Financials, the largest ASX 200 sector (31.4%), remains in a primary down-trend. Declining house prices are likely to drag the index lower. Respect of resistance at 5900 would strengthen the bear signal, while breach of 5300 would signal another decline.

I have been cautious on Australian stocks, especially banks, for a while, and hold more than 40% in cash and fixed interest investments in the Australian Growth portfolio.