ASX 200 Archives - Page 9 of 36 - the patient investor %

November 3, 2018

ASX 200 support but bank decline continues

The ASX 200 continues to find support, with the latest large red candle and subsequent doji, testing primary support at 5650, accompanied by strong volume (indicated by red on the volume chart). Similar buying pressure (accumulation) is evident on 11th and 12th October.

ASX 200 with Volume

This is sometimes lost on the weekly chart but we can see Twiggs Money Flow troughs below have leveled out above the zero line, reflecting a mild bullish divergence (not as strong as rising Money Flow troughs but still a reflection of support). What is also evident on the daily chart (above) is how this week’s rally petered out, with shorter candles, awaiting further direction.

ASX 200

The ASX 300 Banks Index is testing primary support at 7000, the same level as its October 2009 peak. Declining peaks on the Trend Index warn of further weakness and breach of 7000 would offer a long-term target of 5000.

ASX 300 Banks Index

I have been cautious on Australian stocks, especially banks, for a while, and hold over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.

October 27, 2018

ASX 200 at primary support

The ASX 200 is testing primary support at 5650. Declining Trend Index peaks warn of selling pressure and breach of 5650 would warn of a primary down-trend.

ASX 200

Banks are weighing on the index, with the ASX 300 Banks index testing support at 7000. Breach is likely and would offer a long-term target of 5000.

ASX 300 Banks Index

I have been cautious on Australian stocks, especially banks, for a while, and hold over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

October 20, 2018

ASX finds support

The ASX 200 found support around 5900, with a long tail indicating buying interest. Breakout of Twiggs Money Flow above the descending trendline would confirm. Breach of support at 5750 is unlikely but would warn of a primary down-trend.

ASX 200

Banks are weighing the index down, with the ASX 300 Banks index retracing to test resistance at its former primary support level of 7400. Respect would confirm another decline. Descending Trend Index peaks below zero warn of selling pressure.

ASX 300 Banks Index

I remain cautious on Australian stocks, especially banks, and hold over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

October 10, 2018

ASX 200 correction

The ASX 200 broke support at 6120/6150, signaling a correction. Expect support at the rising long-term trendline at 6000. Penetration of the trendline would warn that the primary up-trend is faltering.

ASX 200

Banks lead the decline, with ASX 300 Banks index headed for a test of primary support at 7300. A Trend Index peak below zero would warn of strong selling pressure. Breach of 7300 would signal another decline. Follow-through below 7000 would present a long-term target of 5000, the 2011 low.

ASX 300 Banks Index

I am cautious on Australian stocks, especially banks, and hold over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

October 5, 2018

ASX 200: Miners rally but banks a worry

The ASX 200 found support at 6120/6150, with a long tail indicating buying interest. Follow-through above 6250 would suggest another advance. Breach is now unlikely but would warn of a test of the rising long-term trendline at 6000.

ASX 200

A rally on resources stocks helped support the overall index. Expect the ASX 300 Metals & Mining index to test 4000.

ASX 300 Metals & Mining

Miners were helped by a weakening Aussie Dollar. Breach of support at 71 US cents offers a target of 69 cents. Trend Index peaks below zero warn of strong selling pressure.

AUDUSD

Banks, on the other hand, are weakening. The ASX 300 Banks index broke support at 7700, with a declining Trend Index warning of selling pressure. Expect a test of primary support at 7300.

ASX 300 Banks Index

Falling broad money and credit growth warn of a contraction — unless an unlikely Chinese-led mining boom can keep the wolf from the door.

Broad Money and Credit Growth

House prices are falling.

House Prices

Returns on bank equity are declining due to increased capital requirements, lower credit growth and narrow margins.

Banks Return on Equity

I remain cautious on Australian stocks, holding over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 22, 2018

ASX 200: Banks lack support but miners receive a boost

The ASX 200 correction continues to test medium-term support at 6150. Small candles on the weekly chart indicate a lack of enthusiasm from buyers and support is unlikely to hold. Breach would signal a test of the rising long-term trendline at 6000.

ASX 200

The ASX 300 Banks index continues to test support at 7700. Declining Trend Index warns of selling pressure. Breach of support is likely and would signal a test of primary support at 7300.

ASX 300 Banks Index

The ASX 300 Metals & Mining, however, received a boost from stronger commodity prices and is testing resistance at 3750. A Trend Index peak near zero is less likely but would warn of selling pressure and a primary down-trend.

ASX 300 Metals & Mining

I remain cautious on Australian stocks, holding over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 15, 2018

ASX 200: Correction to test 6000

The ASX 300 Banks index continues to test support at 7700. Declining Trend Index warns of medium-term selling pressure. Breach of support is likely and would signal a test of primary support at 7300.

ASX 300 Banks Index

The ASX 300 Metals & Mining index is also headed for a test of primary support, at 3400. A Trend Index peak at/below zero would warn of rising selling pressure and a primary down-trend.

ASX 300 Metals & Mining

Commodities are already in a primary down-trend but Australian stocks are partially cushioned by a weakening Aussie Dollar.

DJ-UBS Commodity Index

The ASX 200 found medium-term support at 6150 but this unlikely to hold. Bearish Divergence on the Trend Index warns of medium-term selling pressure. Expect a correction to test the rising long-term trendline at 6000.

ASX 200

I remain cautious on Australian stocks, holding over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 7, 2018

ASX 200: Banks & miners lead correction

The ASX 300 Banks index continues to test support at 7700 after respecting its new resistance level at 8000. Breach of support is likely and would signal another test of primary support at 7300.

ASX 300 Banks Index

The ASX 300 Metals & Mining index broke short-term support at 3600 and is headed for a test of primary support at 3400. A sharp fall on the Trend Index warns of selling pressure.

ASX 300 Metals & Mining

The ASX 200 is testing medium-term support at 6150. Bearish Divergence on the Trend Index warns of (secondary) selling pressure and breach of 6150 is likely. Expect a correction to test the rising long-term trendline at 6000.

ASX 200

I avoid commercial banks because of higher funding costs, falling credit growth and rising default risk. Also hold few mining stocks because of exposure to volatile commodity markets. I remain cautious on Australian stocks, holding over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

September 1, 2018

ASX 200 hesitant

The ASX 300 Banks index found support at 7700 and retraced to test its new resistance level at 8000. Respect is likely and would confirm another test of primary support at 7300.

ASX 300 Banks Index

The ASX 300 Metals & Mining index made a weak retracement to test 3750, suggesting strong selling pressure. Breach of short-term support at 3600 is likely and would test primary support at 3400.

ASX 300 Metals & Mining

The ASX 200 rallied above the 6300 watershed but selling pressure is evident in the tall shadow. Bearish Divergence on the Trend Index warns of selling pressure. Breach of 6200 is likely and would warn of a correction, testing 6000.

ASX 200

I am wary of banks because of higher funding costs, falling credit growth and rising default risk and cautious on Australian stocks, holding over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

August 24, 2018August 24, 2018

ASX 200 hurt by banks, miners and politics

After a false break above 8100 the ASX 300 Banks index completed a bull trap with reversal below 7900. Expect a test of primary support at 7300.

ASX 300 Banks Index

Resources stocks continued their correction, with the ASX 300 Metals & Mining index finding short-term support at 3600. Follow-through is likely and would test primary support at 3400, with fears of a US-China trade war undermining commodity prices.

ASX 300 Metals & Mining

The ASX 200 retreated below its new support level at 6300. Political upheaval may have contributed but penetration of the rising trendline would warn of a correction (already signaled by bearish Divergence on the Trend Index).

ASX 200

I remain wary of banks because of higher funding costs, falling credit growth and rising default risk and cautious on Australian stocks, holding over 30% cash in the Australian Growth portfolio.

Colin Twiggs

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.