ASX200: Bullish Outside Day Hints At A Swing Low | Equity Technical Scan
Matt Simpson July 18, 2019 2:28 AM
The index snapped a 3-day losing streak as bulls try to carve out a new low. Whilst the jury is still out for a rebound, we’ve filtered and ranked equities which have outperformed the index.
The index snapped a 3-day losing streak as bulls try to carve out a new low. Whilst the jury is still out for a rebound, we’ve filtered and ranked equities which have outperformed the sector for consideration.
The ASX200 remain in a clear uptrend, and a bullish engulfing candle as formed suggest a swing low could be in place. If bullish momentum returns, we could finally be headed for 6,800 or perhaps the all-time high.
However, prices have appeared hesitant to make a run for 6,800 and there’s been a subtle change of momentum in recent weeks, with recent upswings diminishing before failing to test 6,800.
Furthermore, we may be in for a lacklustre open judging from price action in the US session at the time of writing, unless sentiment can be given a much-needed boost.
Ultimately, we remain bullish above the 6,606 low, but price action over the near-term remains key
- A potential bullish wedge is forming as a continuation pattern, which projects and initial target at the 6,769.6 high. However, we could find resistance around the 6,769.60 – 6,600 zone a tough nut to crack initially
- A clear break above 6,800 brings the all-time high into focus
- However, also keep an eye on the potential for a topping pattern. If bullish momentum wanes and prints a lower high, prices could begin to carve out a head and shoulders top
- A break below the 6,600 area after a lower high would suggest a deeper correction could be playing out
As for the technical scan, we filtered ASX200 equities which have outperformed the index over the past 60 days, using a variation of relative strength. Ranked in order form strongest to weakest, they can be used as an initial point in your analysis to identify potential candidates for breakouts or pullbacks.
Keep an eye on AU employment data at tomorrow 02:30am GMT (11:30 am AEST), as a miss here would see further calls for RBA to ease and likely support the equity markets.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.