April 26, 2002
These extracts from my daily
trading diary are intended to illustrate the techniques used in
short-term trading and should not be interpreted as investment
advice. Full terms and conditions can be found at
The Dow dropped more than 1% to close at 9910
on normal volume, closing below the 10000 level for the first
time in 2 months. The short-trend is down but the secondary
cycle up-trend is still intact.
The Nasdaq Composite index closed down almost 3% at 1663. The
break below the 1700 support level signals the start of a
down-trend on the secondary cycle.
The S&P 500 fell 1.4% to close at 1076,
testing the 1070 support level.
GDP grows by 5.8%
The economy grew at 5.8% in the first quarter,
the highest rate in 2 years. (more)
Despite strong GDP growth, the market has
been undermined by a slew of profit warnings, corporate
accounting worries, declining consumer confidence and
tensions in the Middle East. (more)
The website registration and online security
stock fell 46% after cutting sales forecasts for the second
The All Ords formed an inside day on strong
volume, signaling uncertainty, closing at 3329.
ANZ reaches $1 billion [ANZ]
ANZ reported a first-half
profit of $1.05 billion, 17% above the corresponding period
last year. (more)
Banks see funds management as major growth
Banks have proved unsuccessful at growing
their own fund management businesses so they are buying up
fund managers. (more)
This is not a bad time to buy: the banks
index (XBF) is in a strong up-trend while the investment
& financial services sector (XIF) is weak and suffering
from September 11 fallout.
The Energy index is showing signs of
weakening, with declining relative strength (price ratio).
Mobil and Caltex have both reported losses on refining and
Short-term: Avoid long. Keep stop losses on
existing trades as tight as possible.
Medium-term: Wait for the All Ords to bottom
out - the double top has a target of 3230 to 3240.
Long-term: Wait for the Nasdaq or S&P 500
to break above their January highs.
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