Market Spotlight: Aussie Stocks Approaching Key Resistance

ASX On The ReboundThe rebound in risk appetite this week is bringing some equities indices into very interesting areas. Following a heavy sell off over much of June in response to the larger-than-expected RBA rate hike, the ASX200 is now trading firmly higher. However, the market is fast approaching a key resistance area between 6753.90 and 6908.83. The upper level in particular marks a series of major swing lows over the last 18 months and also sees confluence with the bearish trend line from YTD highs. With this in mind I will be monitoring price action as we test this region, looking for reversal candles to trade a resumption of the bear trend.Keep an Eye OnLast week’s comments from Fed’s Powell regarding recession risks have fuelled the view that projected monetary tightening over the rest of the year won’t materialise. Current moves suggest that traders feel central banks will end up curtailing their tightening programs ahead of current projections. If recession concerns take a key role in G7 discussions this week, we can expect current moves to continue, taking equities higher. However, if there is any push back against this view, or if talks are mitigated with a more optimistic view, this should seen current moves reverse, sending ASX lower.

Source: Tickmill