Weekly Blog 21 August 2020

The XAO has ever so slowly inched higher over the past 12 weeks while it has traded in a range between resistance and support levels of 5800 to 6300. This week it made a new high for that period and as such has the potential to move up to 6800. This week’s candle was a doji which suggests indecision in the market, something that might see prices fall back next week. Some positive news on the virus front might be necessary to see prices rally, but higher prices next week are not out of the question either.

On the trading front last week was a good one with BAP, COH and WTC closed out for acceptable profits. BXB was the only purchase for the week.

Last week I said PPS and ORI were looking like potential trades. PPS has moved up to $0.545 and effectively achieved the target of $0.555. The jury is still out on ORI after it initially moved higher only to fall back a little and make a Harami candle – which does hold out hope of a rise next week.

Stocks of interest this week are VOC, PME & EOS

Weekly Blog

The XAO has continued its sideways drift of 10 weeks and shows little conviction. However, if it can break and close above 6320 with some volume a target of 6800 is quite likely. With the ASX reporting in full swing and Covid19 still lurking in the background, a move up probably will require some positive news on one or both of those fronts.

The week provided me with a wild ride on a trade in MSB which I closed out for and 11% profit. I also bought AWC and details of both trades can be seen in Stock Commentary.

Starting this week I thought I’d also identify a couple of stocks which show potential to be profitable trades. PPS and ORI, are analysed in Stock Commentary. Note that my analysis is provided purely for educational purposes and should not be construed as advice to deal in any particular stock.

 

XAO 16Aug2020

Weekly Blog

The market continued to underwhelm this week with the XAO not trading outside of a 3.2% range since the start of June. With reporting season kicking off the market may be waiting for some good news after having factored in gloom and doom from Covid19. Some positive results from Victoria’s lockdown might also encourage some buying.

This week saw no trades closed out but a buy into PLS.

Weekly Blog

This week the XAO continued its tight range-bound sideways action that has seen it little changed for 8 weeks. Price has formed a possible price channel where this week’s low of Friday is sitting right on the lower boundary. It will be interesting to see if price falls down out of that channel next week to form a correction (~10% fall). My suspicion is that prices will rise again next week to continue the sideways action. That would probably see the run of higher peaks and troughs continue and price ultimately break higher. In short – no clear picture where price will head when the sideways action stops.

No buys this week given the unsettled market, however, NCM was sold for a profit (Click on stock to see details).

Weekly Blog

The XAO still refuses to move either way, opening and closing at the same level  this week – making a doji right on the lower boundary of a long term price channel. The doji could signal a reversal in price next week, something that could see the XAO break down out of that channel for the first time since April. This doesn’t mean further falls are ahead because (a) it might not break lower, and (b) if it does it may recover quickly and move back up towards the upper price channel boundary around 7000/7200. The market is looking for some good news on the virus front and as long as infections remain high it is hard to see investors pushing prices higher.

No buys this week in light of the potential for the market to retrace, although a number of potential opportunities were passed over.

FMG was sold for a profit after only being purchased last week. Click on company name for details.

 

Weekly Blog

The XAO had a sixth week of sideways action in a narrow range with no indication which way it will ultimately break.

This week did provide an opportunity to buy into trades on BHP and FMG (Click on company names for more detail).

Weekly Blog

Alas the promising spike in the XAO was short-lived and prices retraced back to the lower boundary of the channel shown a couple of weeks ago (chart here). However, price hasn’t made a lower weekly low so we live in hope. The weekly candle is a Harami suggesting prices could go lower next week. The market remains undecided with no significant weekly move for 5 weeks.

During the week I bought MSB and closed out a trade on EOS.

Weekly Blog

The XAO rose convincingly this week although Friday made a reversal candle – suggesting next week could open lower. Price broke above 6125 making a higher high after a lower low, a very positive. signal suggesting price is now more likely to rise than fall. However, the outlook remains unclear because of virus concerns. My view is price will go higher but expect regular retracements along the way. As noted in previous weeks, if price can break the previous high around 6311, then 7000 is on the cards.

No buy or sells this week.

Contact

Robert Norman

Phone: 0428 346 951
Email: robert@sharecharting.com.au

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