See charts below with an On Balance Volume indicator and the Money Flow indicator
I often say trading is not about being right, but sizing risk, exits and sticking to a method. However it is nice to get a call correct now and again. Last week I said...
"With the recent rally in the Russell the XSO is playing follow its leader. I suggest you keep a close eye on the Russell for it may well tell us if the spec end of the Aus market will finally rally. Or has it started with the 14 buy signals?"
This week I have posted 2 charts, the XAO and the XSO. I will start with the XAO - you can clearly the volume coming into the index which is a bullish sign, stocks can't go up without buyers. There is a slight bearish divergence between the MFI and the price, however it is slight and to be expected after a big rally.
Moving on to the spec end of the market and the XSO, well it did follow the Russell up but the price is still in a technical down trend, however the volumes look very bullish particularly the OBV which has been trending up for a while and has now broken the down trend line I have drawn. Volumes in this index look even stonger than the XAO.
This week was another strong performance in the 52 week closing high system with 11 alerts.
Have a great week
Peter