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Coverage of stocks will resume next week.




January 07, 2003
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 .






USA
The Dow formed an inside day, down 0.4% at 8740 on average  volume.
The index is forming a base between 7500 and 9130.
The primary trend is down and will only reverse up if the average rises above 9076 (the high from December 02).

The Nasdaq Composite closed 10 points up at 1431.
The primary trend is up.

The S&P 500 formed an inside day, 7 points down at 922.
The index is ranging between 965 and 768, establishing a base. 
All three indices have failed to re-test support at their 6-month lows, a bullish sign. 

The Chartcraft NYSE Bullish % Indicator increased to 52% (January 06).


Senate extends benefits
The Senate extended unemployment benefits, for about 750,000 laid-off workers, until June 01.



Gold
New York: Spot gold is down 380 cents at $US 346.90.



ASX Australia
The All Ordinaries made a false break above resistance, retreating to close down at 3043 on average volume. The gravestone candlestick signals that a reversal of the short-term trend is likely. 
The index is ranging between 2915 and 3050, forming a base. 
A break above 3050 will signal a primary trend change to an up-trend; the last correction taking the form of a line. Look for volume confirmation.
Slow Stochastic (20,3,3) is above its signal line; MACD (26,12,9) is above; Twiggs money flow signals accumulation.






Market strategy
For further guidance see Understanding the Trading Diary.

Short-term: Long if the index rises above 3062. The Slow Stochastic and MACD are above their respective signal lines.
Medium-term: Avoid new entries.
Long-term: Wait for confirmation of the bottom reversal signal.

Colin Twiggs


There is no freedom from risk. There is no freedom from fear.
There is no freedom from pain. There is no freedom from the possibility of failure. 
But there is freedom in acceptance of all of these as part of life,
and moreover, as the least important part of life.

- Victor Sperandeo: Trader Vic - Methods of a Wall Street Master






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