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Trading Diary
May 15, 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 forms a small pennant continuation pattern, rallying 0.7% to close at 8713 on higher volume.
The intermediate trend is up.
The primary trend is down; a rise above 9076 will signal a reversal.

The S&P 500 gained 7 points to close at 946.
The intermediate up-trend continues.
The primary trend is down; a rise above 954 will signal an up-trend.





The Nasdaq Composite rallied more than 1% to close at 1551.
The intermediate trend is up.
The index is in a primary up-trend.

The Chartcraft NYSE Bullish % Indicator increased to 59.95% on May 14, following a Bull Correction buy signal on April 3. 

Market Strategy
Short-term: Long if the S&P 500 is above 948; short if the S&P intermediate trend reverses down (or falls below 898).
Intermediate: Long only when the Dow/S&P primary trend turns upwards; short if the intermediate trend (S&P) reverses down.
Long-term: There are already two bull signals: the March 17 follow through day and the April 3 NYSE Bullish % signal. Wait for confirmation from a Dow/S&P primary trend reversal.




Gold
New York (18.08): Spot gold has retreated to $US 351.40.
On the five-year chart gold has respected the long-term upward trendline.



ASX Australia
The All Ordinaries lost 12 points to close at 2931. The long shadow, strong volume and positive performance of the US market are bullish factors; the index may still hold above the 2909 support level.
The intermediate trend is up; a close below 2909 will signal a reversal.
The primary trend is down. A rise above 3062 will signal an up-trend.

MACD (26,12,9) is below its signal line; Slow Stochastic (20,3,3) has crossed back below; Twiggs Money Flow (21) is weakening.





Market Strategy
Short-term: Long if the All Ords rises above 2943; short if the XAO falls below 2909.
Intermediate: Long if the primary trend reverses up (XAO above 3062); short if the intermediate trend reverses down (falls below 2909).
Long-term: There is already a bull signal: the March 18 follow through. Wait for confirmation from a primary trend reversal.


Tabcorp Holdings [TAH]
Last covered on April 23, 2003.
After rallying to test resistance at 11.00 [d], TAH has retreated to below the long-term moving average.

Twiggs Money Flow (21-day) has failed to cross above zero and signals strong distribution. 
Relative Strength (price ratio: xao) and MACD have turned downwards.





The equivolume chart shows that TAH penetrated resistance at [d] but then gapped back below at [1] on strong volume.
This was followed by a period of consolidation on lower volume and some short-term traders may have entered on a rise above the high of [2]. The rally to [3] was on thin volume and price then retreated below support at [4]; knocking out stops placed below the low of [2].





A break below 10.45, the high of [c], would be a strong bear signal.

Consolidation above 10.45 would be a bullish sign and may signal that another attempt at 11.00 resistance is likely.


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economy and technical analysis of major market indices,
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Colin Twiggs


One should count each day a separate life.

- Seneca (4BC to 65AD).



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