The 4200 level was cracked quite easily this morning with the Asx 200 falling as low as 4183. At 1 pm, it's at 4197 which is down 56. European and US markets are stalling and got no benefit from yesterday's Asian rally. However, the falls here exceed other markets. Good employment numbers just boosted the AUD and limit the chance of further rate cuts, a net negative for the market.
My read now is that the market has topped and a sell signal is in place. However, Japan is steady and the HSI down 0.4% leaving the local market quite extended.
I have a potential short in OSH but I'm planning to deal towards the close since an index rally back through 4200 might support stocks this afternoon.
2.12 The index cascaded further and the most recent low was at 4170 with the latest recovery pushing back to 4180, down 73. The HSI has been open for a while and is holding to a loss of about 0.7% and US futures are weaker by about 0.5%. Obviously not a good set up but the scale of the losses in Australia is surprising.
There's been a substantial buyer lining up in RSG so I decided to cut my short at 199 for a minor profit. The other positions, two longs, are open but at levels where I need to stop.
4.12 Out of CGF for just under 427 average and most of PRU for 275 so there was a minor rally to sell into and the losses were limited.
The index looks dreadful but I didn't want to chase the shorts I'm looking at because we've overshot every market on the downside and are vulnerable to a Friday squeeze.
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