ASX 200 is under selling pressure on Wednesday giving up 1.10% at 6,088 after health officials reported 480 new coronavirus cases in the Victoria state a new daily record high. Healthcare and mining stocks are leading the decline. The index finished sharply higher yesterday, fuelled by optimism about the coronavirus vaccine.
On the economic data, the Australia Retail Sales seasonally adjusted came in at 2.4%, well below the forecasts of 7.1% in June. The Australia Westpac Leading Index rose to 0.44% in June from previous 0.19%.
The previous week, business confidence and business conditions showed signs of improvement in June. Business Conditions came in at -7 above the expectations of -39. Business Confidence rise to 1 above the forecasts of -87 in June.
RBA in the last policy meeting kept interest rates unchanged at 0.25%. There have been 17 rate cuts since November 2011. The central bank warned that the outlook remains uncertain and the recovery is expected to be bumpy, but the conditions have stabilised in June, and the downturn has been less severe than previous estimates.
ASX 200 hovering close to monthly highs but for now, higher levels are capped by the 200-day moving average. The technical outlook for ASX has improved for the short term as the index stays above the 50-day SMA. The longer-term picture remains bearish below the 200-day moving average.
The first support for the ASX 200 will be met at 5,918 the daily low. In case of a move lower, bears might test the next support area at 5,998 the low from July 21. Next support area for the index is at 5,863 the 50-day moving average.
On the contrary, the immediate resistance stands at 6,156 the daily top. Next obstacle for ASX index will be met at 6,222 the 200-day moving average. If the ASX 200 index breaks above, then the next supply zone stands at 6,392 the high from March 10.
