The new trading week will kick off with a strong lead from US equity markets. However, one thing that interests me is that the local “market darling yield plays” have recently been showing signs of losing momentum. The CBA and Telstra charts are examples. Road operator, Transurban is another
The MACD under the Transurban chart showed signs of faltering when it began to diverge with price, making lower highs while price was still making higher highs. This divergence has been followed up by a couple of indications of trend change. Firstly, the MACD crossed below its signal line (histogram bars below 0) and on Friday, price broke below the 20 day moving average (black line).
If these chart signals are correct, there are a couple of scenarios. One would be a period of sideways drifts and relatively choppy trading. The second would be a correction of the last major rally. A break below the support at $9.02 would be a sign that this is underway. Under the correction scenario, a pull back to the 38.2% Fibonacci retracement level around $8.70 would be a possibility.