After a 10% increase in 15 trading days, the Australian share market looks set for a fall. Today is only the second down day in that period. I think the old market saw "nothing goes anywhere in a straight line" applies here, and in my opinion the market needs a "flush".
Ranges are compressed, volatility has dropped out of bed, most of the oscillators, RSI's and Bollinger Band analyses are showing an overbought situation and traders have begun getting out of their takeover plays after the Foreign Investment Review Board voted unanimously to knock back the Singapore Exchange's bid for the Australian Security Exchange.
The fundamentals supporting the market in the long term remain in place. However, to me the short term looks very ugly. Traders will use their own signals, but any sell signal on the Aussie 200 is worth serious consideration.