The ASX 200 index has visited the support zone of its trading range on multiple occasions over the past 4 months. Each time a strong buying day has followed soon after with the index rising 40-70 points to kick off a rally towards the top of the range.

 Bargain hunters have not obliged this week. The index continues to languish nervously near support. Despite the prospect of a firm open, today’s trading may provide more of the same. Ongoing pressure on the iron ore price and next week’s holiday in China may see a relatively cautious day.

CBA and Telstra have played a part in keeping the ASX 200 index near support levels. Both stocks are out of favour and account for a combined 11.4% of the ASX 200.

There has also seen support for the other 3 major banks as investors switch out of CBA. This may now be constraining the ability of the banking sector to provide lift off for the index. The other 3 banks are significantly above recent lows and investors are staying clear of CBA. At the same time, the ongoing sell-off in iron ore has also seen the mining sector out of favour.

Telstra shareholders will be hoping that the last of the Fibonacci retracement levels might provide some relief. On Wednesday, the share price bottomed at the 78.6% retracement level of its whole 2009/2015 rally.  This level can often serve as a turning point and any sign that it is being rejected with stronger prices in coming days would be an encouraging development for chart followers.