ASX 200 slides as investors sell the rip rather than buy the dip

The S&P/ASX 200 closed 5.4 points lower, down 0.06%.

The headline will show only a tiny 5.4 point or 0.06% drop in the benchmark ASX 200 today. Nothing to worry about...right?

Perhaps not, but also, perhaps. The main issue as some of you may have already spotted, is that we closed smack bang on the session's low – some 0.87% below the session's high.

So, in terms of demand vs supply (or should we say...excess supply) there really was about 0.87% of it to the downside today. Sounds quite a bit worse than -0.06%, right? 🤔

Bull markets are all about buying the dips and FOMO'ing into the rips. When the rips get sold, that's the first half of the opposite equation...⚠️

Click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all the key upcoming economic data in tonight's Evening Wrap.

Also, I have detailed technical analysis on the NASDAQ Composite and the S&P/ASX 200 in today's ChartWatch.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 5.4 points lower at 8,374.0, 0.87% from its session high and smack–bang on its session low. In the broader-based S&P/ASX 300 (XKO), advancers lagged decliners by a narrow 139 to 141.

Generally a tinge of tariff sell off unwind today – just a tinge. Information Technology (XIJ) (+1.6%) got a bounce, so too did Materials (XMJ) (+0.88%).

I concluded “tariff unwind” on Materials / Resources (XJR) (+0.71%) because base metals were generally flat-to-modestly-lower overnight. For the former, Tech, the decent bounce after the initial sharp sell off in US tech stocks was probably the main catalyst (see ChartWatch or technical analysis).

Gold (XGD) (+0.79%) remained the stalwart, it seems Aussie gold stocks can do no wrong at the moment – which is fine by me as there are plenty of great uptrends in this sector.

Financials (XFJ) (+0.61%) also rebounded, and another strong performance by Pro Medicus (ASX: PME) (+5.2%) kicked Health Care (XHJ) (+0.52%) along (talk about your great uptrends! 📈🚀).

Lagging today, were Utilities (XUJ) (+-%) – another poor performance from sector heavyweights AGL Energy (ASX: AGL) (-1.5%) and Origin Energy (ASX: ORG) (-0.3%) drove losses there…while Energy (XEJ) (-0.09%) dipped on lower crude oil and natural gas price overnight (still tariff volatility flowing through these markets).

Otherwise, as the index’s narrow loss and nearly even market breadth suggests, it was largely a holding pattern day after Monday’s big sell off. It was a disappointing result in terms of price action, and I’ll discuss this in significant detail in ChartWatch below, but also given we only just set a new record high on Friday! 🤦

Top 20 Best and Worst tables below, but as usual, check out the Movers section for details on stock-specific moves.

The top 20 gainers among the Top 500 stocks today

The top 20 losers among the Top 500 stocks today

ChartWatch

NASDAQ Composite Index

No bids, no bids, no bids…🤔

It’s not my intention to conduct running commentaries on charts here, rather to only cover the charts I think are of interest due to the latest technical developments. I know we only covered this one in yesterday's Evening Wrap, but I think it deserves a follow up based on last night's candle.

No doubt, like me, this morning you woke up and checked your relevant device for how US stocks fared overnight. Many would have looked at the decline in the COMP and other US indices as bearish, after all, down means bearish, right?

Not always. We ended up with a white candle so there was a degree of excess demand in the system after the big dip on the open – there was at least some buy the dip activity.

Bull markets are all about buying the dips and FOMO'ing into the rips. When the rips are sold, that's the first half of the opposite equation...⚠️

So, there is some modest encouragement for the bulls from last night’s price action. I say only modest, because we sill ended up with an upward pointing shadow – i.e., at some stage of that buy the dip rally either the demand-side lost some puff and conviction and or the supply-sided gained respective traits!

We also gapped lower from the 31-Jan candle. Gaps equal no bids between point A and point B. No bids anywhere among those price points – none at all (repeat this over and again in your head…no bids, no bids, no bids…) 🤔

It smacks of a concerning lack of demand-side control.

So, there’s some good news but still a great deal of bad news with respect to last night’s price action.

Ideally, we see another white candle/excess demand fuelled follow through tonight – firming 19204 as a point of demand. We need to reclaim the short term trend ribbon (which has transitioned back to neutral), and push back towards what is now solidifying as a stronghold of excess supply between 19970-20205 (i.e., the new 31-Jan point of demand formed by last night’s candle at 19970 – not labelled on the chart for lack of room – and up to the all time high of 20205).

A close below 19204 is bad news for the bulls and likely sets up a test of 18598-18831 as well as the dynamic demand of the long term uptrend ribbon.

S&P/ASX 200 (XJO)

Closed on the low...after a big black candle...not a great look...⚠️

At least the Comp showed a white candle.

Our best effort today was a 0.87% upward pointing shadow. 0.87% because we closed on the absolute low of the session, and that much from the high. That equates to 0.87% of excess supply. Excess supply that was clearly motivated to sell the rip – or whatever rip there was just after the open because that’s when the selling started – and it persisted right up until the final cross…

Big supply signals like the long black candle with low session close witnessed yesterday aren’t much fun – but if there’s a silver lining – it’s that in and of themselves they don’t mean a great deal without confirming price action.

One could make a strong argument that today’s price action is just that – confirming. Confirming that in the very short term at least, the supply-side has grappled control of the Australian stock market.

Broader trends remain up, so I don’t want to throw the baby out with the you know what…but today’s response to yesterday’s sell off is not a good look at all.

Watch now for a close below the short term uptrend ribbon, that would be another bad look. Then, potentially you could have bad going to worse as the price subsequently probes deeper into demand towards 8160.

Only white candles and or downward pointing shadows can save us from such a fate – and I suggest we need to see them as soon as tomorrow – no later please! 🤞

Economy

Today

• There weren't any major data releases in our time zone today

Later this week

Wednesday

• 02:00 USA JOLTS Job Openings January (7.88 million forecast vs 8.10 million in December)

• 12:45 CHN Caixin Services PMI January (52.3 forecast vs 52.2 in December)

Thursday

• 02:00 USA ISM Services PMI January (54.2 forecast vs 54.1 in December)

• 23:00 UK Bank of England Official Bank Rate (4.50% forecast vs 4.75% previous)

Friday

• 00:00 USA Prelim Nonfarm Productivity & Unit Labor Costs December Quarter

  • Productivity: +1.8% p.a. forecast vs +2.2% p.a. in September quarter

  • Labor Costs: +3.3% p.a. forecast vs +0.8% p.a. in September quarter

Saturday

• 00:30 USA Non-Farm Payroll Data January

  • Employment Change: +154,000 forecast vs +256,000 in December

  • Average Hourly Earnings: +0.3% m/m forecast vs +0.3% m/m in December

  • Unemployment Rate: 4.1% forecast vs 4.1% in December

Latest News

Interesting Movers

Trading higher

• +20.9% Pureprofile (PPL) - No news since 30-Jan Becoming a substantial holder and 28-Jan H1 FY25 & Q2 FY25 Business Update, rise is consistent with prevailing short and long term uptrends 🔎📈

• +15.6% Antipa Minerals (AZY) - No news since 29-Jan Multiple High-Grade Gold and Copper Intersections at Minyari, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +13.2% Predictive Discovery (PDI) - A$69M Strategic Placement to Lundin Family and Zijin Mining, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends 🔎📈

• +12.6% WA1 Resources (WA1) - West Arunta Project - Luni Metallurgical Results

• +9.8% Appen (APX) - No news since 30-Jan Q4 FY24 Quarterly Activity Report and Appendix 4C, broadly higher ASX tech sector today, upgraded to buy from accumulate at Ord Minnett and price target increased to $3.30 from $2.80, rise is consistent with prevailing short and long term uptrends 🔎📈

• +9.3% Black Cat Syndicate (BC8) - No news since 30-Jan Quarterly Activities Report and Appendix 5B, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends 🔎📈

• +9.0% Catalyst Metals (CYL) - No news since 30-Jan Corporate Presentation - Plutonic Belt Exploration, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.5% EBR Systems (EBR) - No news since 28-Jan EBR leases new facility to expand manufacturing capabilities, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +7.2% Cettire (CTT) - No news, modest rebound after yesterday's sharp sell-off following Amendments to US Tariff regime

• +6.6% Larvotto Resources (LRV) - No news since yesterday's Company Presentation - 121 Mining, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends 🔎📈

• +6.1% Orthocell (OCC) - No news since yesterday's Remplir Regulatory Application Submitted for Canada, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +5.2% Vault Minerals (VAU) - No news, broadly higher ASX tech sector today, rise is consistent with prevailing short and long term uptrends, a recent addition to ChartWatch ASX Scans Uptrends list 🔎📈

• +5.2% Pro Medicus (PME) - PME signs A$53M, 7-year contract with BayCare, rise is consistent with prevailing short and long term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈

• +4.9% Ora Banda Mining (OBM) - No news since 31-Jan Extension to Repayment of Loan Agreement, broadly higher ASX gold sector today, rise is consistent with prevailing short and long term uptrends 🔎📈

Trading lower

• -8.6% DUG Technology (DUG) - No news, fall is consistent with prevailing short and long term downtrends 🔎📉

• -4.5% Audinate Group (AD8) - Change in substantial holding (increase by Australian Super - clearly didn't help!), fall is consistent with prevailing short and long term downtrends, one of the most Featured (highest conviction) stocks in ChartWatch ASX Scans Downtrends list 🔎📉

• -3.8% Lynas Rare Earths (LYC) - No news, fall is consistent with prevailing short and long term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

• -3.6% Neuren Pharmaceuticals (NEU) - No news, fall is consistent with prevailing long term downtrend (perfectly repelled by the long term downtrend ribbon!) 🔎📉

• -3.1% OOH!Media (OML) - No news, fall is consistent with prevailing short and long term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉

Correction: In yesterday's IM section for Vulcan Energy Resources (ASX: VUL) we incorrectly referred to a Change in substantial holding notice as indicating a "Rinehart sell down". It was in fact not a sell down, but rather a dilution in holding due to a recent share issue. There was no change to the number of shares controlled by Bianca Hope Rinehart (in her capacity as trustee of the Hope Margaret Hancock Trust), simply the voting power of this entity declined to 6.49% from 7.51%.

Broker Moves

• 29METALS (29M)

  • Retained at sell at Canaccord Genuity; Price Target: $0.160 from $0.210

• ARN Media (A1N)

  • Retained at sell at UBS; Price Target: $0.570 from $0.510

• Audinate Group (AD8)

  • Retained at overweight at Morgan Stanley; Price Target: $9.00 from $10.50

• Aeris Resources (AIS)

  • Retained at hold at Ord Minnett; Price Target: $0.230 from $0.280

• Aml3d (AL3)

  • Retained at buy at Shaw and Partners; Price Target: $0.400

• Amcor (AMC)

  • Retained at equal-weight at Morgan Stanley; Price Target: $15.50

• Austin Engineering (ANG)

  • Retained at buy at Shaw and Partners; Price Target: $0.700

• Appen (APX)

  • Upgraded to buy from accumulate at Ord Minnett; Price Target: $3.30 from $2.80

• American West Metals (AW1)

  • Retained at buy at Shaw and Partners; Price Target: $0.320

• Betmakers Technology Group (BET)

  • Retained at buy at Ord Minnett; Price Target: $0.170 from $0.160

• Brickworks (BKW)

  • Upgraded to buy from neutral at UBS; Price Target: $30.50 from $29.50

• Challenger (CGF)

  • Retained at buy at Citi; Price Target: $7.80

• Close The Loop (CLG)

  • Retained at hold at Shaw and Partners; Price Target: $0.500 from $0.550

• Chorus (CNU)

  • Retained at outperform at Macquarie; Price Target: NZ$9.83

• Cettire (CTT)

  • Retained at sell at Citi; Price Target: $1.300

• Cleanaway Waste Management (CWY)

  • Retained at buy at UBS; Price Target: $3.30 from $3.40

• Cygnus Metals (CY5)

  • Retained at buy at Shaw and Partners; Price Target: $0.250

• DigiCo REIT (DGT)

  • Initiated at outperform at Macquarie; Price Target: $5.33

• Dropsuite (DSE)

  • Downgraded to hold from buy at Shaw and Partners; Price Target: $5.90 from $4.80

• Emerald Resources (EMR)

  • Downgraded to sell from hold at Ord Minnett; Price Target: $3.50

• Frontier Digital Ventures (FDV)

  • Retained at buy at Bell Potter; Price Target: $0.520 from $0.700

• Firefly Metals (FFM)

  • Retained at buy at Shaw and Partners; Price Target: $1.900

• Fluence Corporation (FLC)

  • Retained at hold at Bell Potter; Price Target: $0.085 from $0.100

• Fisher & Paykel Healthcare Corporation (FPH)

  • Retained at sell at Citi; Price Target: NZ$32.00 from NZ$33.50

  • Retained at hold at CLSA; Price Target: $36.20

  • Retained at buy at Goldman Sachs; Price Target: $40.70 from $42.70

  • Retained at hold at Jefferies; Price Target: NZ$35.25 from NZ$38.50

  • Retained at sector perform at RBC Capital Markets; Price Target: NZ$30.00

• Hansen Technologies (HSN)

  • Retained at buy at Ord Minnett; Price Target: $6.30 from $6.00

  • Retained at buy at Shaw and Partners; Price Target: $7.20

• Harvey Norman (HVN)

  • Retained at buy at Citi; Price Target: $5.20

• Insurance Australia Group (IAG)

  • Retained at accumulate at Ord Minnett; Price Target: $9.65 from $9.45

• JB HI-FI (JBH)

  • Retained at buy at Citi; Price Target: $110.00

• Monadelphous Group (MND)

  • Downgraded to neutral from buy at Citi; Price Target: $16.30 from $16.20

• Nine Entertainment (NEC)

  • Downgraded to neutral from buy at UBS; Price Target: $1.450 from $1.650

• Nufarm (NUF)

  • Retained at sector perform at RBC Capital Markets; Price Target: $5.00

  • Retained at neutral at UBS; Price Target: $4.50

• News Corporation (NWS)

  • Upgraded to buy from neutral at UBS; Price Target: $64.50 from $51.00

• OOH!Media (OML)

  • Downgraded to neutral from buy at UBS; Price Target: $1.250 from $1.850

• Predictive Discovery (PDI)

  • Retained at buy at Canaccord Genuity; Price Target: $0.520

• Pilbara Minerals (PLS)

  • Upgraded to neutral from underperform at CICC; Price Target: $2.40

• Pro Medicus (PME)

  • Retained at overweight at Morgan Stanley; Price Target: $310.00 from $300.00

  • Retained at sector perform at RBC Capital Markets; Price Target: $275.00

• Premier Investments (PMV)

  • Retained at overweight at Morgan Stanley; Price Target: $32.00

• Perpetual (PPT)

  • Retained at buy at Citi; Price Target: $24.20

• Qantas Airways (QAN)

  • Retained at outperform at CLSA; Price Target: $10.90 from $10.70

• Rio Tinto (RIO)

  • Retained at overweight at Morgan Stanley; Price Target: $136.50

• Resmed Inc (RMD)

  • Retained at add at Morgans; Price Target: $43.60 from $41.33

• Resolute Mining (RSG)

  • Retained at hold at Ord Minnett; Price Target: $0.400 from $0.500

• Reliance Worldwide Corporation (RWC)

  • Downgraded to neutral from buy at UBS; Price Target: $5.85 from $6.35

• Seven West Media (SWM)

  • Retained at sell at UBS; Price Target: $0.150 from $0.140

• Southern Cross Media Group (SXL)

  • Retained at neutral at UBS; Price Target: $0.640 from $0.560

• Titomic (TTT)

  • Retained at buy at Shaw and Partners; Price Target: $0.300

• Viridis Mining and Minerals (VMM)

  • Retained at buy at Ord Minnett; Price Target: $1.000

• Westgold Resources (WGX)

  • Retained at buy at Argonaut Securities; Price Target: $5.70 from $5.40

  • Retained at buy at Canaccord Genuity; Price Target: $4.25 from $4.70

  • Retained at outperform at Macquarie; Price Target: $3.20 from $3.70

  • Retained at outperform at RBC Capital Markets; Price Target: $3.40 from $4.00

Scans