A low volume selloff today but enough downside to flip the daily trend to DOWN. This means that the systematic portfolio will defend open positions and stop issuing new buy signals. The All Ords is either meandering in a larger triangle or has put in a ‘lower swing high’ pattern. Conformation of the latter is a break down through 4515 and a very bearish sign. The Dow Jones Transports have failed to make new highs again. For the third time price has reversed off a line of resistance even though the Industrials have pushed onward and upward. This situation remains very negative for the market remembering that this ‘non-confirmation’ rarely, if ever, lets us down. A lot or people are calling for a strong rally into Xmas being a normal seasonal expectation. In fact the US indices have a 72% chance of a positive close to the year. However, to date in 2009 seasonal tendencies have been a poor indication of what reality brings.
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Fri, Nov 20, 2009
ASX Commentary