ASX 200 index managed to reverse the morning loses and has turned positive despite the losses in Wall Street on Friday. Wall Street ended lower on Friday but off the daily lows leaving room for a rebound today. You can find more in the previous analysis: Nasdaq 100 In A Perfect Technical Correction, Are Bulls Ready for Rebound?
Australian stocks meet strong resistance at the 200-day moving average during August, while the consecutive rejections lead to a sharp correction on Friday that send ASX 200 below the 6,000 mark.
Mining and health stocks are pushing the index higher while technology and industrials shares are under selling pressure.
Performance of Services Index Below Expectations
On the economic data, the ANZ Job Advertisements declined for one more month to 1.6% in August from 16.7% in July. The Aussie Performance of Services Index came at 42.5 in August below the forecasts of 44.
China Economic Data Shows Improvement in Global Demand
An improvement in China exports shows that global demand is picking up. The China Exports came in at 9.5%, beating the estimates of 7.1% in August. The Imports registered at -2.1% below the forecasts of 0.1% and the China Trade Balance in US dollars improved to $58.9B above the estimates of $50.5B.
ASX 200 Technical Analysis
ASX 200 adds 0.33% at 5,944 in a move showing that bulls are alive after the sharp correction on Friday. The technical bias remains negative, and bullish traders need to see a break above the 50-day moving average at 6,040. Above 6,040 the bulls would face the 200-day moving average resistance at 6,118 which has proved a strong hurdle.
On the downside, support for the ASX index is at 5,869 the daily low. Next support stands at 5,840 the 100-day moving average which if breached would enhance the bearish momentum.
ASX 200 Daily Chart