ASX: XAO MAKING HIGHER LOWS SIGNALS THE BOTTOM IS IN..?
After narrowly missing my target of 6049 by 25 points by the 12th of November the ASX: XAO took a steep 2 day dive South from what looks to be echos of the volatile carnage on US Markets, particularly the FANGS suffering self created TRUST issues.
Having shot themselves in the foot by abusing Customer/Investor TRUST (like the Banks here) the FANGS, along with the cheap easy money of low interest rates and QE, have been primarily responsible for driving US Markets to unrealistically high Valuations over the past several years.
Unfortunately the ASX still seems to have uncoupled from the US sufficiently to not avoid catching a Cold when our big cousin across the Pacific sneezes...
Fortunately its NOT a baddie (or based in anything rational! ) and OUR retrace seem to have arrested at 5780 on the XAO. If this key support level holds Australian Investors should be able to have confidence that the All Ordinaries HAS FOUND A BOTTOM at my previous assertion swing low of 5723.
At moment of posting, the Bourse was deciding its next move at 5838.
As we see it climb higher as I strongly suspect towards the end of the Trading Week, I retain my CONFIDENCE of early posts on this topic that the larger drawdown that started in early October is done for. For the EMA's to return to the projected Parabolic path it may take a short while longer than originally anticipated on the 12th.
That is for Australia. I AM not so confident this is the case in the U.S. Markets..? Any U.S. friends care to give your brief take in comments of what you think is in store for you guys in the near term..?
With Brexit jitters still faffing about like an annoying English Fop causing uncertainty in Global Markets this dynamic WILL continue UNTIL Boris Johnson and fellow HARD BREXITEERS MAN UP and remove the derisive, laughable "Dancing Queen" Teresa May. This drawn out saga, that has long past becoming a 'yawn' Internationally, will continue to create unnecessary volatility in Europe. FX and Futures Traders should be making hay whilst the Sun shines brightly here. It wont last for much longer with the Queen of the EU Puppets, May, being deservedly tossed out on her treacherous wooden ear within a fortnight!
Back to the Land Downunder...
If the 2nd lowest support line (grey dashed line) holds @ 5780 this shows the Market has put in a higher low @ 5838 (pink dashed line) and thus...THE RALLY IS ON !
*Note - the lower Volumes being put in on the selldown highlighted on the 'AO' oscillator (The green dotted line with circled arrow) and the lower peak of the pink DMI line (red circled arrow and dashed line from previous peak showing alignment) which aligns with the thesis of lower Volume being sold off for lower prices (ie. a drop in Selling pressure.)
As such I AM even further convicted to add LONG positions to the ASX: XAO as the recent shakeout has strengthened the Market and the large Short Sellers will have to turn hide and run, admitting defeat that they cant find any more suckers to buy their irrational "doom and gloom" Bear fantasy.
Confirmation of this will STILL only come after a close above my initial target of 6050 but by that stage the Alpha gains have largely evaporated.
Choose your Risk - own it, place your Bet and "as you sow so shall you reap..!"
Remember in the Markets, as in Life FORTUNE favours the BRAVE.
Always DYOR.
Having shot themselves in the foot by abusing Customer/Investor TRUST (like the Banks here) the FANGS, along with the cheap easy money of low interest rates and QE, have been primarily responsible for driving US Markets to unrealistically high Valuations over the past several years.
Unfortunately the ASX still seems to have uncoupled from the US sufficiently to not avoid catching a Cold when our big cousin across the Pacific sneezes...
Fortunately its NOT a baddie (or based in anything rational! ) and OUR retrace seem to have arrested at 5780 on the XAO. If this key support level holds Australian Investors should be able to have confidence that the All Ordinaries HAS FOUND A BOTTOM at my previous assertion swing low of 5723.
At moment of posting, the Bourse was deciding its next move at 5838.
As we see it climb higher as I strongly suspect towards the end of the Trading Week, I retain my CONFIDENCE of early posts on this topic that the larger drawdown that started in early October is done for. For the EMA's to return to the projected Parabolic path it may take a short while longer than originally anticipated on the 12th.
That is for Australia. I AM not so confident this is the case in the U.S. Markets..? Any U.S. friends care to give your brief take in comments of what you think is in store for you guys in the near term..?
With Brexit jitters still faffing about like an annoying English Fop causing uncertainty in Global Markets this dynamic WILL continue UNTIL Boris Johnson and fellow HARD BREXITEERS MAN UP and remove the derisive, laughable "Dancing Queen" Teresa May. This drawn out saga, that has long past becoming a 'yawn' Internationally, will continue to create unnecessary volatility in Europe. FX and Futures Traders should be making hay whilst the Sun shines brightly here. It wont last for much longer with the Queen of the EU Puppets, May, being deservedly tossed out on her treacherous wooden ear within a fortnight!
Back to the Land Downunder...
If the 2nd lowest support line (grey dashed line) holds @ 5780 this shows the Market has put in a higher low @ 5838 (pink dashed line) and thus...THE RALLY IS ON !
*Note - the lower Volumes being put in on the selldown highlighted on the 'AO' oscillator (The green dotted line with circled arrow) and the lower peak of the pink DMI line (red circled arrow and dashed line from previous peak showing alignment) which aligns with the thesis of lower Volume being sold off for lower prices (ie. a drop in Selling pressure.)
As such I AM even further convicted to add LONG positions to the ASX: XAO as the recent shakeout has strengthened the Market and the large Short Sellers will have to turn hide and run, admitting defeat that they cant find any more suckers to buy their irrational "doom and gloom" Bear fantasy.
Confirmation of this will STILL only come after a close above my initial target of 6050 but by that stage the Alpha gains have largely evaporated.
Choose your Risk - own it, place your Bet and "as you sow so shall you reap..!"
Remember in the Markets, as in Life FORTUNE favours the BRAVE.
Always DYOR.
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