Welcome to my Australian All Ordinaries Index Report. This report is in no way indicative of what individual stocks will do but rather a general ‘crystal ball’ of overall market movements. Individual stocks often do not move in the same direction or the same magnitude as an index. To know what stocks to buy or what to sell you must do your own study and research. Please read the disclaimer below.
Most markets around the world continued to fall this last week. Last week I wrote “My bias for this week is a short rally followed by a further decline to complete the primary cycle.” Two weeks ago I wrote “The All Ords has a 22-week cycle from trough (low) to trough and it is currently in week 20. That indicates a short term drop of 316 - 556 points over the next 2-3 weeks.” (http://davidschirmerxao.blogspot.com/)
The All Ordinaries Index has fallen down to 5952 since Tuesday July 24, a 512 point drop. While Australia slept Friday night the Dow Jones fell down 281 points (2.0%) and the FTSE slipped down another 67 (1.1%) points. The Australian All Ordinaries Index will open down on Friday’s close; where will it go this week?
It has met time and price criteria for the primary cycle. The challenge is that the market is also in the time period for a further decline into the 46-month cycle low, and even further into the 18-year cycle low. So we have two possible scenarios playing out right now:
- Even though the time and price criteria for the 22-week cycle decline have been met, the markets may continue to fall directly into there 46-month and 18-year cycle lows.
- The 22-week cycle decline is finished and the market will rise before continuing its decline into the longer term cycle lows.
I mentioned in my last two reports that “A highly probable date for the 22-week cycle low is August 3-6.” Time is always more important than price therefore my bias is scenario #2; that the market opens low Monday morning and starts trading up Tuesday continuing for 1-3 weeks forming a new Primary Cycle high before continuing its decline into the longer term lows.
Resistance on the way up is at 6000, 6134, 6268, 6335 with major support at 6201 & 6469. Minor support levels for the decline are 5943, 5837, 5732, with major support for further decline at 5627, 5518, 5043, 4568, 4092. and ... Minor reversal dates are August 10, August 14 & August 22.
Next report out on Monday, August 13.
Yours in abundance,
David Schirmer
Check out http://davidschirmer.blogspot.com/ for insights to my Secret Journey.
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1 comment:
Hi David,
Looks like this prediction is becoming a fairly accurate prediction of where the market went this week. Keep up the good work, the information in the blogs are very helpful.
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