Financials are testing their new support level at 5900/6000. Falling housing prices are likely to drag the index lower. Penetration of the rising trendline at 5800 would warn of another test of primary support at 5300.
Materials are also testing their new support level at 12500/12600 but respect is far more likely, given the tailwind from iron ore prices.
The ASX 200 is consolidating at 6200 but continuation to test resistance at 6300/6350 is likely. Expect stubborn resistance, followed by a correction.
I remain cautious on Australian stocks and hold more than 40% in cash and fixed interest in the Australian Growth portfolio.
