XJO WEEKLY    

Price structure: Bearish continuation.

The XJO has set a clear breakdown from the 14-month rising channel, the Index may be entering a corrective movement decline. Support at 8083 is yet to be tested, to remain bullish this level should provide a reversal signal. On price declines Index value can retest initial breakout levels, in this case the 7910 level and the Q1 2024 period breakout at 7632 points. At this current level the XJO has erased al of 2025 gains.

Indicator: Relative strength 14: Sell

Relative strength has turned lower in line with the reversal in the Index and has moved below the key 50 level. Only further movements higher towards the 70 level can set a continuing bullish signal for further higher price movements.
The RSI turning further lower to move below the 50 level, is a strong indication is for negative momentum to develop leading to Trend failure and further declines.

Comments last week:-  The Weekly chart shows a pivot point reversal has been set. The impulsive range sets the tone for lower values, indicating a shift in market sentiment towards a bearish outlook. Several key support levels have been broken, as the chart value moves towards the lower channel line. As discussed last week the 8385 level was key to hold, the current close sets the target support of 8083 point to hold. A further decline will set up a corrective movement in the Index that may see an increase in volatility selling.

XJO DAILY  

Price structure:  Testing the 200 SMA.

The Daily view of the XJO highlights the breakdown below the 8330 level with the small back test of this level. On a Daily basis this is the level for the Index to break through higher before a Bullish view can be developed. The expanded range set last Friday may see some  follow through early this week.

Indicator:  Relative strength 14:  Neutral

The Relative strength Indicator (14) has moved below the important 50 level, the overall RSI trend shows slowing momentum associated with the current larger trading ranges. This is a sell signal, a move lower too or below the 30 level is now possible. Traders would be looking for further Sell signal should a continued lower price move occur with the RSI closing below the “30” level targeting towards 20.

Comments last week. The Daily shows 5 days of decline following the rejection of higher prices 2 weeks ago. The Daily support level of 8330 is providing some support observed by the short-range day last Friday. The 200-day moving average and the 8083-support level may be tested in the coming weeks on further declines. Following the RBA rate decision the financial sector losses, a large component by weighting has moved the Index lower. Traders can consider a major top is beginning to develop.

S&P 500 WEEKLY:  Pivot reversal

Currently a price channel is developing in the Weekly S&P500 with Resistance at 6100 points and Support showing at 5853 points. Last week the 5853 level was tested in confluence with the rising channel line. To confirm a top pattern is developing a breakdown below the 5853 level is required, this would setup a potential retest of the 5670 level and put the Index into a corrective movement lower.

Indicator:  Relative strength 14.   Declining momentum.

The Bearish Divergence continues to develop in the Relative Strength Index (RSI) and has failed to indicate a reversal in the current Trend.
The current movement lower, shows declining price momentum in this consolidation area, only a further move towards the 70 level will confirm the bullish signal.

If the RSI crosses below the key threshold of 50, it will confirm a bearish outlook.

Comments from last week.:  In summary, the current market sentiment exhibits a notable shift towards bearishness, as evidenced by the Index continuing to find resistance at the 6100 level. Although the price action remains within the ascending channel, the current consolidation at this significant resistance level may develop into the topping pattern in the coming weeks.

SPX DAILY    Price structure:  Testing Support

The Pivot point reversal discussed last week has followed through to retest the 5832 support level. The Price Gap set during January 2025 has now been closed, highlighting the bearish sentiment prevailing in the market. As a result, traders are monitoring closely for further developments, particularly looking for any signs of a continued downward corrective price movement. The rally last Friday may be a short covering move and does not indicate a bullish reversal, because of its range this piercing Bullish candle can lead the index higher, only confirmed with a close over 6020 points.

Indicator: Relative strength 14. 

The Relative Strength Indicator (RSI) has moved below the key 50 level, suggesting that with the consolidating prices, momentum has now turned negative. If the RSI falls further below the pivotal 50 level, it will likely confirm a bearish outlook, leading to further downside targets and a potential retest of the 5900-5800 level.

Comments from last week:  Following a short breakout rally early last week the Daily chart has set a strong Pivot reversal pattern at the close of trading last Friday, suggesting a potential shift in market direction. This Pivot Reversal pattern is indicative of strong selling acknowledged by the large range set last Friday, where the price action reflects a struggle between bullish and bearish forces the market has moved below to critical support levels indicating prices controlled by the sellers.
Indicative targets are into the 5900 point level where the last Price Gap remains unfilled, the potential is for further declines to the 200 day moving average.

NASDAQ (100) DAILY Price structure:  Bearish

During last week the 20,900 level was defended on Tuesday and Wednesday, however last Thursday set a very strong impulsive range to close towards the 200 day moving average.

This strong price pattern has developed into a broadening Top formation in the past weeks confirmed by the current breakdown. The key level this week is the Support – Resistance level of 20,690 with a close over the 20,900 level to keep a bullish view.

Indicator: Relative strength 14: Bearish turn

Relative strength has now turned lower and moving below the 50 level, indicating negative momentum as price moves lower. The rising RSI over the 50 value can provide some early insight for the current Major Primary UP trend to develop further. A further move lower below the 50 level would send a very Bearish signal not to be ignored.

Comments from last week.  The second major reversal signal at this 22,133 level and indicates a Technical double top pattern has been set. Overall, the Nasdaq is trading within a wide channel with 21,133 as Resistance and 20,900 as a major Support level. The Pivot point set on last Friday’s close has also set a strong impulsive range bar. Further declines could be expected to retest the lower support level. This strong price pattern may develop into a broadening Top formation in the coming weeks.

USD Spot GOLD – DAILY: 

With the short term trendline failing to provide some form of immediate support, price has set a low at $2832.0. The potential for a full retest of the $2790 level remains. With the solid close off the Friday low, a retracement could be expected. The overall Bullish move has been broken on the Pivot point set last Tuesday; some consolidation could now be expected below the key $3,000 level.

Indicator:  Relative Strength 14:  Swing lower.

The RSI has turned lower to finish at the 50 level. This is a bearish signal, and it remains a strong observation price has lost its strong upward momentum. Further declines in the coming weeks towards the 30 level will reflect the potential for further consolidation at these current levels. Longer term holders and traders should now monitor the RSI for a divergent Buy signal.

Comments from last week: The outside range bar discussed last week remains the key observation with price last week moving marginally higher than the $2943 resistance level but failing to gain buyer momentum leaving the FO, Fake out high in place. Price failure at this level would see the $2790 level as a potential retracement target should the short term trendline fail to hold a price decline within the current bullish but over extended price move.

AUD GOLD – DAILY: Consolidation

Gold in Australian Dollar term remains resilient above the $4,500 level. A combination of the declining USD Gold price and the solid decline in the $AUD has maintained the price in the $4,600 area. As the USD Gold price consolidates, the expectation remains for the AUD Gold price to remain supported above the $4,500 level. A close below this level would indicate a short-term top in place and would set a bearish tone in the Australian Gold producers.

Indicator:  Relative Strength 14: 

The Relative Strength Index (RSI) is showing a consistent move above the pivotal 50 level. This persistence above the 50 midline suggests that the bullish momentum is not only intact but may strengthen. Traders are advised to watch for any minor pullbacks as potential buying opportunities within this broader uptrend, as the overall market sentiment remains strongly in favour of continued gains.

Last week’s note indicated the rejection bar as a reversal signal. The current inside range set last week further confirm a reversal may develop in this well-developed 12 month extended price movement. Traders should monitor the current setup for a price break lower to confirm a short-term high point may be in place. Further price movement below the $4,500 level will confirm this view.

SILVER Price structure:  Trading range

The (FO) fake out high set 3 weeks ago remains the key high point for Silver. Last week significant price decline to close below the $31.50 level again suggests Silver is not within a Bull market structure but remains in consolidation. The expectation this week is for a retest of the $32.50 level. A further decline below $31.0 would set a very bearish tone as the RSI remains below the key 50 level.

Relative strength 14:

Relative strength is now moving in line with the underlying reversal price structure. The current reading has moved below the key 50 level, showing Bullish momentum has been lost, but declining from the high 60’s momentum point.  This indicator should be monitored for a swing back above the key 50 level, completed with a continuing closing price above the $31.50 level.

Comments from last week. Silver has failed to develop any Bullish momentum as the price moves over the $32.50 resistance level. Last Friday set a small pivot reversal bar with price closing on this key level.

The current price action with Daily price ranges overlapping is a secondary type movement often followed with an impulsive move breakout. A breakdown lower has the $31.50 support level targeted. A breakout higher sets a target of $36.30.

AUSTRALIAN VOLATILITY INDEX:  The equities trader’s compass.

The current volatility closing value has closed above the key 11 level following a large spike higher during the week.  Current closing value indicates the XVI volatility level is within the Bullish level for Equities as the market volatility begins to see mid-week higher priced PUT option insurance to cover portfolio risk.

With the indicator value moving higher Mid-week, the forward pricing (Volatility) of PUT options (insurance) was increasing, this is observed against an overall Bearish decline in the market. Volatility now rules in this current XJO200 consolidation phase.

For continued support of equities, the XVI should remain subdued below the “13” level.

The cost of 3month forward PUT options is moving lower from recent higher levels over 13.

IMPORTANT DISCLAIMER

The information in this report is of a general nature only. It is not personal financial product advice. It does not take into account your objectives, financial situation, or needs.

You should therefore consider the appropriateness of this general information in light of these statements. The Australian School of Technical Analysis (www.astatrading.com) recommend that you refer to the Product Disclosure Statements of any financial products which are discussed in this report before making any investment decisions.

ASTA accepts no responsibility for your actions and recommends you contact a licensed advisor before acting on any information contained in this general information report.