July 15, 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 dropped sharply in the morning session
but rallied to close only 0.5% down at 8639 on strong
This is a
bear market, with primary and secondary cycles trending
The late rally on the Nasdaq Composite was
stronger with the index closing up 0.66% at 1382.
The primary and secondary cycles are in a down-trend.
The S&P 500 imitated the Dow, closing
down 4 points at 917.
Primary and secondary cycles trend downwards.
Intel, IBM and Microsoft will report their
second-quarter results this week, with Intel adding 6% in
Pfizer - Pharmacia
The largest US drug company is to
buy Pharmacia for $US 60 billion, boosting research and
development and giving Pfizer control of Celebrex and Bextra
arthritis medication. (more)
Coke leads with options
Breaking from the traditional method of
accounting disclosure, Coca Cola will expense stock options
from the fourth quarter. (more)
Investing in bonds
Some analysts are punting
bonds, discounting the risk of an interest rate rise.
Euro = $US 1.00
The euro reaches parity with the US
The All Ordinaries closed down 12 points at 3135
on weak volume.
The primary cycle is in a bear trend,
secondary cycle has completed a reversal but
has yet to follow through with a new high. 3130 is proving
a significant support level.
Slow Stochastic (20,3,3) is below its signal
Exponentially-smoothed Money Flow signals
Woolworths experience a surge in fourth-quarter
sales, and raise annual earnings forecasts. (more)
A falling wedge is a bullish signal. Relative
Strength (price ratio: xao) and exponentially-smoothed Money Flow
are positive but MACD shows weakness.
The Australian dollar closed
above 56 US cents, as the US currency weakens.
Preston Resources [PSR]
The West Australian nickel miner has agreed to purchase a 1
million ounce Malaysian gold project. (more)
PSR has been suspended from quotation since 25 October
Goodman Fielder [GMF]
GMF has reached a 3-year high, possibly due to
the share buy-back. Relative Strength (price ratio: xao) and
exponentially-smoothed Money Flow are strong, while MACD is
United Energy [UEL]
UEL has crossed to above its 150-day moving
average. Relative Strength (price ratio: xao) is below zero
but improving, while MACD is positive and
exponentially-smoothed Money Flow signals
Short-term: Avoid new entries. The Slow
Stochastic is below its signal line while MACD is
Medium-term: Wait for the All Ords to signal
Long-term: Wait for a bull-trend on the
Nasdaq or S&P 500 (primary cycle).
Thought for the Day:
It takes a wise man to
sell in a boom. Any fool can sell in a recession. -
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