ASX 200 Stalls During Wednesday Session

• ASX 200 is unable to hang on to gains.
• A mixed bag of results across the board.
• New York is very bullish on Wednesday, perhaps leading to strength in Australia on Thursday.

During Wednesday’s trading session, the ASX 200 initially tried to rally but quickly surrendered its gains. At this point, the market appears somewhat overbought, although the overall sentiment remains bullish. Notably, US markets are experiencing a midday rally which could very well have a spillover effect in Australia, but a pullback at this point in time certainly would make a little bit of sense.

Ultimately, the ASX 200 looks as if the 8350 level will continue to hold significance, so buyers might be interested in the index in that general vicinity. The 50-Day EMA is positioned just below and is rising, so that could also come into play in the near term. On the upside, the  8500 level continues to be a notable resistance point and arguably, a near-term target. That said, the market is probably a target but at this point the market is just simply a little stretched.

Commonwealth Bank of Australia (CBA)

The Commonwealth Bank of Australia experienced a rally of just under 1% on Wednesday,  as traders continue to see the stock as a winner. The stock is up 36.39% over the last 12 months, with a 4.99% increase in the last 30 days alone. Closing at a price of AU$157.75, the market is currently in consolidation, albeit at very high levels. Ultimately, the market seems to be attracting buyers on dips, and at this point, traders will be closely monitoring the AU$162 level as a potential breakout. Notably, the next earnings call is set for 12 February.

Goodman Group (GMG)

Goodman Group rallied 2.06% during the trading session as the real estate giant has been very strong over the last year. Over the last 12 months, GMG has delivered an astounding 57.16%, as it now sits in the AU$38.63 region. This REIT continues to be a favourite among Australians and is now on the verge of a major breakout. One would have to assume there is probably a certain amount of psychological resistance near AU$40, but the earnings call on 13 February could serve as a catalyst for this stock. The company continues to exhibit characteristics of a “buy on the dips” mentality.

REA Group Ltd (REA)

REA Group rallied 0.55% during the trading session on Wednesday, closing at AU$239.27. Ultimately, REA has been a winner over the last 12 years, gaining 31.10% as the communications giant looks forward to the earnings call on 6 February. The market is currently consolidating around the 50-Day EMA, suggesting that traders are looking for the next catalyst. It’s very possible that the earnings and revenue report will be the next catalyst, as a bit of digestion of the previous uptrend seems to be the order of the day in this market.

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