The ASX200 is set to open back around 7080 this morning following a tough session on Wall Street where falls were spearheaded by the financials, tech, materials and consumer discretionary names – we wouldn’t be surprised if the -0.4% fall by the SPI on Friday proves optimistic this morning.
- The upside momentum has waned through August although the short-term trend remains bullish, if not a touch tired for now – a major technical breakdown doesn’t occur until we see a close below 6750.
- Our preferred scenario is the local market will pull back begrudgingly towards the 6900 area over the coming weeks i.e. around 3% below Friday’s close.
Assuming our view towards bonds and Bitcoin is correct there obviously remains the potential for stocks to fall harder but we don’t believe the markets long & / or bullish enough to accelerate on the downside although we can see more aggressive declines by the rate-sensitive stocks/sectors.
MM remains neutral to bearish the ASX200 short-term
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