May 3, 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 Terms
of Use .
The Dow is back down at the 10000 level, closing
at 10006 on normal volume. The secondary cycle up-trend is
The Nasdaq Composite index managed a more spectacular 1.9% fall,
to close at 1613. The secondary cycle is in a down-trend.
The S&P 500 again tested the 1070 support
level, closing at 1703. A break below the support level has a
calculated target of 960.
Gold is gaining strength
Gold shares are already discounting higher gold
prices and may be out-performed by gold
The All Ords gained slightly, closing above the
3300 support level, at 3315 on strong volume.
Chaikin Money Flow has moved to above zero and
the Slow Stochastic above its signal line, but it is too early to
call this a market bottom.
ResMed in need of resuscitation [RMD]
RMD recorded strong growth in sales and
earnings but warn of difficulty meeting forecasts for the
The stock fell as low as $4.73 before
rallying to $5.40. The sharp increase in Chaikin Money Flow
should not be interpreted as a buy signal.
Strong retail sales may precipitate an
interest rate rise. (more)
The gold index XGO continues to rise, with
relative strength (price ratio: all ords) improving.
Short-term: Avoid long. Keep stop losses on existing trades as
tight as possible.
Medium-term: Wait for the All Ords to form a base.
Long-term: Wait for the Nasdaq or S&P 500 to break above
their January highs.
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