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ASX 200 @ 12 OCT 2021Text me if you have any questions/comments for me. ----- 12 Oct 2021 – Market Watch The last time I did an analysis on the S&P/ASX 200 was on 5 October (red arrow). Since then, the ASX 200 has recovered less than 0.5%. It is currently testing the counter-trendline (purple dotted line). A failure to breakout would likely see another retracement to the 7200 psychological support. Further overhead resistance looks to be around the 7360-7400 levels. Last week, I mentioned that I would be more willing to trim positions rather than add new ones especially if there is no good recovery in the markets. At that time, I was exploring 1 or 2 buying opportunities but instead, I entered 3 stocks that have given me gains of up to 4%. Besides the purchases in Australia, I was also adding 3 new stocks into my US portfolio and 1 new stock into my Malaysia portfolio. Why did I suddenly become bullish when I am naturally quite conservative? As explained during last Sunday’s FB livestream, I was quite happy with the news that the US debt ceiling crises has been averted for now. The US government has kicked the can down the road to early December 2021. This should calm the markets for the next few weeks before the political rhetoric heightens again towards the end of November. The US employment figures that came out last Friday disappointed the market and points to a slowing down of job creation. The combined number of jobs created in August and September were less than 50% of the target of 1 million jobs. I have a strange feeling this would temper the FOMC’s hawkish stance and they might even elect to postpone making an announcement on tapering bonds next month. If my gut feeling is correct, this would place a lot of pressure on the tapering announcement to be made in December’s FOMC meeting. Couple this with the debt ceiling crises that will no doubt loom large again, I expect that these twin risk events will create a lot of uncertainties in the markets. When the US sneezes, the whole world gets lung cancer. I don’t think we will be spared here in Australia if there is a retracement in the US. As I mentioned previously, I still expect that a strong retracement will place in Australia over the next 2-3 months. With all that doom and gloom, why did I enter new positions? Personally, I used the previous retracement (in late Sep and early Oct) to find stocks that were outperforming the market. Usually, when the market recovers, these stocks will tend to outperform the market and recover at a faster pace. Besides that, with most of the uncertainties coming in early December, I expect the markets to experience a mini bull run at least over the next few weeks. With that said, I am still trigger happy and I will cut my positions in a heartbeat if the markets turn against me. How about you? Have you entered new positions? Or are you looking to sell some old positions for a quick profit (or lower loss)?
ASX:XJO
by Jerm88
6
ASX 200 @ 5 October 2021 5 Oct 2021 – Market Watch The last time I did an analysis on the ASX 200 was on 27 September (red arrow). I mentioned as long as the index doesn’t experience a successful push to 7500 levels, I would likely trim positions instead of collecting new ones. With uncertainties stemming from the twin events of the US debt ceiling and Evergrande, the ASX 200 has tested the lower boundary (7150 levels) of the support zone (highlighted in blue). Even though the index closed with a pin bar and on the upper boundary (7250 levels), I still think it’s too soon to say that this is the end of the bleed. As I mentioned on Sunday’s FB livestream, I am expecting the next 2-3 months to be a difficult period to trade. US President Biden has voiced out his pessimism of being able to raise the debt ceiling. If that is unsuccessful, will the printing of money end? Whether you like it or not, the global equity markets have benefitted from this additional liquidity and the thoughts/fears of even turning off the tap can send markets crashing. Evergrande finding a majority buyer for one of its subsidiaries has injected some confidence into the markets; at least for the near term. I still think more needs to be done to restructure the huge debt but I’m cautiously optimistic that the Chinese government will step in. As it is, there is already a directive to government-linked companies to do all they can to help out Evergrande. Reading between the lines, this usually means buying the distressed assets of Evergrande. To get more of my commentary on Evergrande, you can watch the livestream recording (text me for the link) starting from the 16-min mark. I have exited almost all of my positions last week and I am only left with one stock. Will I buy more? I am evaluating 1 or 2 possible buying opportunities, but I am not anywhere close to pulling the trigger yet. I don’t subscribe to the diamond hands philosophy, especially when it comes to my trading portfolio. Thus, I prefer to be very selective in this uncertain period. How about you? Are you collecting more stocks now? Or are you keeping your powder dry and buying in when the retracement has ended, and signs of market rebound has appeared? If you find this market analysis helpful, let me know in the comments. May the markets continue to be with us! Disclaimer:- I’m a mid-term trader and I hold my stocks between 1-3 months. I’m using Trend Following strategies and my analysis will be from a perspective as a Trend Follower. I’m sharing these analyses for learning purposes and as always, DYOR.
ASX:XJO
by Jerm88
2
ASX 200 @ 27 SEP 2021Text me if you have any questions/comments for me. ----- 27 SEP 2021 – Market Watch As mentioned in last night’s livestream, the ASX 200 is currently trading in No Man’s Land. This is a zone where it is trading in a band that is bounded by a strong resistance (7400 levels) and strong support (7250 levels). Usually, when an index or stock is stuck in No Man’s Land, there needs to be a strong catalyst to break either the resistance/support. With the markets still feeling the unease stemming from Evergrande’s missed interest payment last Thursday and the continued lack of clarity on the US Fed’s tapering plans, I fear we might continue to be stuck in this tight band (blue shaded zone) for at least the coming week. The best-case scenario is if there is a successful push to 7500 levels and beyond. If it happens, I would be more bullish on the market. As it is, I am more trigger happy when deciding to trim positions. If Evergrande somehow presents a huge contagion effect at a global level similar to Lehman Brothers, the ASX 200 will likely drop to possibly even break 7150 levels. 88% of my stocks are green today. How about you? If you find this market analysis helpful, let me know in the comments. May the markets continue to be with us! Disclaimer:- I’m a mid-term trader and I hold my stocks between 1-3 months. I’m using Trend Following strategies and my analysis will be from a perspective as a Trend Follower. I’m sharing these analyses for learning purposes and as always, DYOR.
ASX:XJO
by Jerm88
10
Where to for the XJO - is it time to go short?I note that there is a lot of noise in the financial media currently around potential collapses in the Chinese property market and various other factors, but let's screen that out and have a look at what the XJO chart is showing. From the chart, it looks reasonably apparent that a downtrend has started forming, starting from the most recent high of 13 August. The chart shows that following the open on 14 August, the market failed to make a new high and started trending downwards for the following week. Fairly solid resistance was then found at around 7460 on 19 August with several retests until around 9 September (between these dates the market seemed to be trading in a fairly tight 60 point range). On 9 September the support level was broken and for the following week or so (until 17 September), the previous support level providing resistance, with another support offered around 7360 (the close on 9 September). Today's movements seem to pretty clearly break through that resistance, but we'll need to see what tomorrow brings to see if there is confirmation of the breakdown. Other things that I note on the chart are the 20 and 50 day MAs. To me, it looks like the 20 day MA will likely cross the 50 day in the next day or so (a bearish indicator in my view). All in all, for me it's not wholesale shorting time until the 200 day MA is broken at around 7000, but there may be opportunities in the short term if you're looking for them. So in summary what visible to me on the chart * A clear downtrend indicated by both MA slopes and a pattern of Lower Highs and Lows * Two clear breakdowns from ranges, with support flipping to resistance. * MA crosses likely. Anyway if you've liked this post check out my blog - www.nickthetraderguy.com
ASX:XJOShort
by NicktheTraderGuy
2
Trend breakI'm not a technicals person. Pulled the chart up and threw a regressession trend over the ASX200 since the bottom of COVID selloff. The trend was broken nearly this exact time last year, and was followed by dip buying. Happened again (though not on RSI oversold) in late October. I believe there is a running theory around option expiry causing dips, but also general bearishness around this time of year which has historically been tough for equities. Add to that an iron ore price collapse and China debt fears and one wonders whether the dip buyers will return to save the XJO. No position, dont invest based on macro or technicals.
ASX:XJO
by adenjb
ASX 200 @ 20 SEP 202120 SEP 2021 – Market Watch As predicted in last night’s livestream, the twin US events (ie. Last Friday’s Quadruple Witching Hour and the upcoming FOMC meeting) are dragging markets down this morning. At market close, the ASX 200 is down 2.1% to test the 7250 support levels created in July 2021. As mentioned last week, 7150-7250 levels (purple lines) will be a support zone for the index. Any break of this zone will also coincide with a structure break. We will have a better gauge on the Fed’s decision whether to taper by Thursday morning. If the Fed does decide to taper, I foresee a drop to potentially 6900 levels (orange line). If the Fed postpones the key decision to November’s meeting, we should be able to see an immediate challenge of 7400 levels again with a potential of even possibly re-testing all time high levels. This would also depend on how China deals with the Evergrande problem and whether there will be a shock to its financial systems. Some analysts have likened the Evergrande issue to the Lehman Brothers issue back in 2008 that precipitated the Global Financial Crises (GFC). I’m not super familiar with Evergrande but I don’t think there will be as big an impact to the world markets. There are three main reasons for my thinking: - (i) China has been reigning in their financial markets since the 1st half of 2021. Thus, there worldwide exposure isn’t as large as before. (ii) Even before the reigning in, China’s markets were not as big and open as the US. (iii) Since the GFC, all the big financial institutes have been forced (through regulation) to beefed up their financial reserves. Even with the Covid pandemic crash in March 2020, most financial institutes held strong and were not severely impacted like they did during the GFC. In terms of my strategies in the market, I will wait to see what happens this Wednesday (US trading hours) and that will guide what I do in the market. It’s too soon to engage bearish strategies. There might be short-term opportunities to short but from my experience, it’s better and safer to trade based on what I see, rather than what I feel. What do you think? Are you out of the markets completely? Or is this a juicy time to pick up undervalued stocks? If you find this market analysis helpful, let me know in the comments. May the markets be with us! Disclaimer:- I’m a mid-term trader and I hold my stocks between 1-3 months. I’m using Trend Following strategies and my analysis will be from a perspective as a Trend Follower. I’m sharing these analyses for learning purposes and as always, DYOR.
ASX:XJO
by Jerm88