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I scan for opportunities and cannot see anything that really excites me. As I see it, there is much lethargy surrounding the markets at the moment. Sort of in the doldrums.
To entice me into the market I need to see some degree of momentum. Whether that be in certain sectors or in gold or large caps. Nothing for the moment but I still check daily.
I don’t really want to hold a couple of stocks – I am either in it or out.
As I scan the only majors that I can see as being mildly interesting are:
ABC, ASB, ASX, BKN, EVN, HVN
But this is not enough for me to jump in at the moment.
I don’t see any major fallout at the moment either but there is just simply little right now that is lifting markets in a convincing manner.
Let’s look at come charts:
The most telling of all is the All Ords weekly:
Click to Enlarge
I don’t expect we will see the dive to wave five as suggested above. But it does give me a reason to continue to stand on the sides.
The other point I note from the chart is that there has been a steady decline in the volume moving average over the last five years. More investors are cooling their heals now. Just watching and holding back.
The next chart is a daily:
Click to Enlarge
As you can see in the close up view the XAO has been range trading – going nowhere – for the last several months. So there is no strong signal to jump in – or for that matter to panic.
We zoom into the daily in this next chart:
Click to Enlarge
And what hits me in the eye is the oscillator well below zero. This is merely confirmation of what we already know – the market is lack luster.
But don’t turn your back. Markets rarely stay dull for exceedingly long periods of time.
Enjoy the ride
Tom Scollon
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