June 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 Terms
of Use .
The Dow arrested its decline, closing almost
unchanged above the 9000 support level at 9120 on very strong
This is a
bear market, with primary and secondary
cycles trending down.
After a weak opening the Nasdaq Composite
rallied to close up 0.4%, above the key 1400 support level, at
The primary and secondary cycles trend downwards.
The S&P 500 also had a weak opening and
then rallied to above the key 960 support level, closing 3
points down at 973.
Primary and secondary cycles continue downwards.
Indices recover from WorldCom
Markets staggered on disclosure of the WorldCom
accounting fraud but rally by the close.
In the world's largest
corporate fraud, WorldCom Inc executives concealed expenses,
overstating earnings by more than $US 4 billion.
The Fed leaves rates unchanged
The Federal Reserve
maintains a neutral stance and leaves the overnight bank
lending rate unchanged at 1.75%. (more)
The All Ordinaries fell sharply to close 1.5%
down at 3130 on above-average volume.
Primary and secondary cycles are in a bear
MACD (26,12,9) and Slow Stochastic (20,3,3) are
below their signal lines.
Chaikin Money Flow signals distribution.
Aussie dollar falls
The dollar fell more than 2% in overnight
Telstra tested support at $4.45 before
closing at $4.50. Relative Strength (price ratio: xao) is
falling and Chaikin Money Flow signals distribution, while MACD
shows a bullish divergence.
AurionGold rejects takeover bid
Directors of AurionGold have rejected the Placer Dome takeover
bid, citing a number of factors including Placer's falling
share price. (more)
The Detrended Price Oscillator is rising,
while Chaikin Money Flow holds just above zero.
The Amcor spin-off acquires UK paper
merchant Bunzl Fine Paper for $366 million. (more)
Relative Strength (price ratio: xao) is
strong, while Chaikin Money Flow and MACD appear weak.
Short-term: Short in selected sectors - MACD and slow
Stochastic are below their signal lines.
Medium-term: Wait for the All Ords to signal a reversal.
Long-term: Wait for a bull-trend on the Nasdaq or S&P 500
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