Aussie market ran into a brick wall of profit taking from global investors ahead of similar profit taking in Europe and US tonight. As we have been saying for the past few weeks, all the macro, fundamental, technical and trend leading indicators were showing profit taking was coming. It was all about the trigger point after US Fed pulled back the rate rise cycle. In the shorter term, profit taking just comes down to the two main key factors in financial markets that never disappoint…GREED and FEAR. US markets were set up to fall while fund managers were waiting for the end of month to lock in the positive Q1 and also a near flat rolling 12mth performance. Aussie market fair value with yield premium adjustment has dropped by 150 points in the past month on the back of downgrades to banks and resources. The risk of going to a new lower low in April is very likely. Time to be patient and pick the time to buy-in or add more exposure. (VIEW LINK)
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