All Ords tests trendline support

The XAO Indicator held blue during this week of declines but the All Ords now sits right on an established trendline. In a somewhat positive sign, the All Ords made a new low today, briefly traded below the trendline and then rallied strongly. We should see a rally for 2 or 3 days or so. I suspect that the strength or otherwise of that move will give an indication of which way this market now wants to go. Here's an updated chart. Click to enlarge.

XAO: Indicator blue, struggles with mid-channel trendline

The XAO Indicator remains blue so the trend remains up but there are some nervous nellies about calling a top in the market. Sooner or later they will be right and given the way the All Ords is struggling with the mid-channel trendline, a correction could come sooner than later. Here's an updated chart.



All Ords continues upward

The All Ords continues on its merry way and now promises to move into the upper half of an upward sloping trend channel which began in mid-2010. At the same time, the XAO Indicator continues to be blue indicating that (since 7 September 2010) its been a good time to be long stocks. Once the All Ords enters into the upper channel, the target would be at least 5200, with 5300 more than just a possibility. And by the look of the charts of some of the big-caps like BHP, RIO, CBA etc, there could be much higher prices to come.
Click on chart to enlarge

All Ords humming along

The All Ords continues to chug along (and up). The XAO Indicator has now remained blue since early September 2010. Stocks have done extraordinarily well in that period - unless you are holding perennial losers like many blue chips. The big movers have been the small caps especially many "penny dreadfuls". This is what this blog is all about. Go long and hold long while the XAO Indicator is blue. When it turns red be very careful. I have tested hundreds if not thousands of indicators over many years and nothing comes close to the guidance provided by the XAO Indicator. And it makes sense. This indicator will turn blue and stay blue when the general market is rising. Most stocks (some more and some less) will rise during this period. Conversely most will fall when the indicator turns red. That's the time to either reduce your holdings or get out of the market altogether (if you wish to avoid a potential roller coaster ride). And here's another tip. Most of the big jumps in price - the takeovers, the profit upgrades, will happen when the indicator is blue. Check for yourself, just look at the dates to the left and see how your holdings performed during those periods.
Here's an updated chart.