ASX200: Bullish Outside Day Hints At A Swing Low | Equity Technical Scan

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

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.