ASX 300 Banks Index Archives - the patient investor %

December 5, 2018

ASX 200 heads for a bear market

The ASX 200 dipped below primary support at 5650, signaling a primary down-trend. A Trend Index peak at the zero line warns of strong selling pressure. The market is still open, and a lot can happen by the close, but the prospect of a bear market is now close at hand. Expect retracement to test the new resistance level but respect would confirm a bear market, offering a target of 5000.

ASX 200

The two largest sectors are already in a primary down-trend.

ASX 300 Metals & Mining Index broke support at 3500, signaling a decline with a target of 3100.

ASX 300 Metals & Mining

The ASX 300 Banks Index, in a down-trend since 2015, is currently testing long-term support at 7000. Breach would offer a target of 5000.

ASX 300 Banks Index

I have been cautious on Australian stocks, especially banks, for a while, and hold 40% 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 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 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.

August 17, 2018

ASX 200 breakout

Strong earnings reports and continued interest in major banks lifted the ASX 200. Rising Trend Index troughs signal buying pressure. Breakout above 6300 offers a short-term target of 6500.

ASX 200

The ASX 300 Banks index followed through above 8100, indicating another rally with a medium-term target of 8500 (long-term 8750).

ASX 300 Banks Index

But the ASX 300 Metals & Mining index broke support at 3750, warning of a test of primary support at 3400. Fears of a US-China trade war are likely to undermine commodity prices.

ASX 300 Metals & Mining

I am also wary of banks because of higher funding costs, falling credit growth and rising default risk .

So the primary trend on the ASX 200 is up but I remain cautious, 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 11, 2018

ASX 200 buying pressure

The ASX 300 Metals & Mining index continues to test support at 3750. Breach of support and the rising trendline would warn of a correction to 3400.

ASX 300 Metals & Mining

The ASX 300 Banks index recovered above 8000, the false break suggesting another rally, targeting 8500.

ASX 300 Banks Index

I remain wary of banks, however, because of higher funding costs, falling credit growth and rising default risk .

The ASX 200 continues to test resistance at 6300. Rising Twiggs Money Flow troughs signal buying pressure. Breakout above 6300 would present a short-term target of 6500.

ASX 200

The primary trend is upward but economic indicators and the potential impact of a US-China trade war make me cautious. I hold more than 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.

July 28, 2018

Iron ore bounce lifts the ASX

Iron ore spot prices bounced off support at $63/tonne. Follow-through above $68 would suggest another rally to test resistance at $80 but that seems unlikely given the current threat of a trade war.

Iron Ore Spot Price

The ASX 300 Metals & Mining index found support at 3750. Breakout above 4000 would signal another advance but reversal below 3750 and a correction to test primary support at 3400 are more likely if iron ore retreats.

ASX 300 Metals & Mining

The ASX 300 Banks index continues to consolidate in a bullish narrow band above its new support level at 8000. Follow-through above 8100 would suggest another advance, with a target of 8700. The index is still in a primary down-trend but it is evident that a bottom is forming. A higher low on the next correction, followed by a new high, would signal the start of a primary up-trend.

ASX 300 Banks Index

The banking sector faces the prospect of higher funding costs, falling credit growth and rising default risk and I remain wary.

The ASX 200 is again testing resistance at 6300. Breakout would signal a primary advance with a target of the October 2007 high at 6750.

ASX 200

Technical signals suggest a primary advance while economic indicators warn of rising headwinds and a potential bear market. I remain cautious, with more than 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.