Thinking about 6000
A risk on session for international markets led by Europe is likely to see a firm opening on our stock market this morning. This will have traders again thinking about the potential implications of a break above 6000 by the ASX 200.
Soft commodity markets and concerns about the implications for Australia of waning growth in China may contain any latent animal spirits in the local share market at least temporarily
China’s March trade data will be a key focus for markets. Investors will be keen to get a line on how China’s economy is faring now that the disruptive effect of the Lunar New Year is behind it. This creates a parallel with upcoming US data where Fed interest policy will depend on how well the economy recovers from the impact of cold winter weather. Tomorrow’s read of March retail sales will provide some early insight into this.
For technical traders, the key will be not so much the 6000 resistance itself, but how decisively the ASX 200 index moves clear of this level if it is broken. The index has displayed volatile, oscillating behaviour in recent weeks. In this context a weak move above 6000 may have no particular significance at all but simply represent minor rally in a pattern that sees the market continue to drift around current levels. On the other hand if buyers can mount a decisive move past 6000 in the days following its initial breach, a more positive outlook is in prospect.
For further comment from CMC Markets please call 02 8221 2137.
Frequently Asked Questions about this Article…
A break above 6000 for the ASX 200 could signal a positive shift in market sentiment. However, it's important to see how decisively the index moves past this level, as a weak move might not have significant implications.
China's economic data, particularly trade figures, are crucial for the Australian stock market. Investors are keen to understand how China's economy is performing post-Lunar New Year, as it can influence market sentiment and trading decisions.
Soft commodity markets are important because they can affect Australia's economic outlook. Concerns about waning growth in China could impact these markets, potentially influencing investor sentiment and market performance.
Technical traders should focus on how decisively the ASX 200 index moves past the 6000 level. A strong move could indicate a positive market trend, while a weak move might suggest continued volatility and oscillation.
US economic data, such as retail sales, can provide insights into the global economic environment. This data can influence investor expectations and decisions in the Australian stock market, especially in relation to interest rate policies.
The Federal Reserve's interest policy is crucial as it affects economic recovery expectations. Changes in interest rates can influence investor sentiment and market movements, impacting both US and international markets, including Australia.
The 6000 level is significant as it represents a psychological barrier for the ASX 200. Breaking this level could indicate a shift in market dynamics, but the strength of the move is key to understanding its true significance.
Investors can stay informed by following market news, economic data releases, and expert commentary. Engaging with resources like CMC Markets can provide valuable insights and updates on market trends and potential impacts.
Call 1300 880 160
Start a chat
Schedule a call
