Australian traders are faced with a falling market. Nonetheless there are always strong looking stocks that attempt to defy the bearish view of the broader market. At the moment AGI and MXI are looking great technically. But in the face of such overpowering bearishness affecting the broader market domestically and global markets, we wonder if they will eventually come unstuck and collapse.
In the case of AGI, the safest route to follow is to wait for the stock to retest and break above $2 again. In the case of MXI the safest route is to set a tight stop at around 57 cents. There is not much room to move in these stocks before things go wrong, but that is the kind of market we are in at the moment - even the strongest stocks will fall to the clutches of the bears with only a small negative move in their respective share prices.
Elsewhere in the market we look at an updated Copper chart (see chart below). We have a previous post where we said Copper was going to fall to around $3.25. It has done that and is currently retesting support at $3.25. We are watching to see if it breaks because if it does, it will provide an additional bearish lead for those trading commodity driven stocks such as BHP, RIO (Australia / UK) and Vale (Brazil)....even if the stock itself is not involved in copper. But Copper is often used as a leading indicator for the entire commodity market. So if Copper falls, well, you can take a strong bet on the direction of additional commodities such as Iron Ore, Gold, Plantinum etc......
