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Trading Diary
July 10, 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 fell 1.3% to close at 9036 on lower volume.
The intermediate trend is up. A decline below 9000 will signal a down-turn.
The primary trend is up.

 


The S&P 500 lost 14 points to close at 988.
The intermediate trend is up. A fall below 982 will signal a down-turn.
The primary trend is up.

The Nasdaq Composite retreated 1.8% to 1715.
The intermediate trend is up.
The primary trend is up.

The Chartcraft NYSE Bullish % Indicator rose to 76.14% on July 9.

Market Strategy
Short-term: Long if the S&P 500 is above 1010. Short if the index falls below 962.
Intermediate: Long if the S&P is above 1010.
Long-term: Long.


Jobless claims rise
New unemployment claims increased to 439,000 last week.
(more)

Bank of England cuts rates to 48-year low
Catching the market by surprise, the BOE cut overnight lending rates by 0.25% to 3.5%.
(more)




Gold
New York (17.22): Spot gold is at $US 345.00.
On the five-year chart gold is above the long-term upward trendline.



ASX Australia
The All Ordinaries rallied to close up 15 points at 3023 on higher volume.
The negative performance in the US is likely to place a drag on the local market.
The intermediate trend is up.
The primary trend is up.

MACD (26,12,9) is below its signal line; Slow Stochastic (20,3,3) is above; Twiggs Money Flow (21) signals accumulation.



Market Strategy
Short-term: Long if the All Ords is above 3032.
Intermediate: The primary trend is up; Long if the All Ords is above 3032.
Long-term: Long.


Roc Oil [ROC]
Another Oil & Gas Exploration stock.
ROC has ranged between 1.80 and 1.20 for the last 3 years before a recent downward break in April 2003.

The break may well prove to be a bear trap with ROC having rallied back above the support level on strong volume.
Twiggs Money Flow (100-day) has completed a strong bullish divergence; while MACD is bullish.



Relative Strength (price ratio: xao) has made a new 3-month high. 



Volume and volatility dried up at [1], when ROC re-tested the previous low.
Price then rallied, breaking through resistance at [2] on strong volume.
Volume has dried up on the correction, indicating the likelihood of another rally.



A rise above 1.33 will be a strong bull signal.
A fall below 1.20 would be bearish.

Buy-stops (or sell-stops) are useful tools for timing entries.
Stop losses should always be placed below the most recent Low (or above the most recent High).
The most recent Low will be interpreted differently by traders following the short, intermediate or primary cycles.

New readers: If you trade without stop losses, you are not trading - you are gambling.


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The weekly Trading Diary offers fundamental analysis of the
economy and technical analysis of major market indices,
gold, crude oil and forex.
The monthly What's New newsletter covers new articles
on Trading and the Economy, as well as new software updates.



Understanding the Trading Diary has been expanded to offer further assistance to readers.

Colin Twiggs


Of crimes - none is greater than having the things that one desires;
Of disasters - none is greater than not knowing when one has enough.
Of defects - none brings more sorrow than the desire for possessions.
The contentment that one has when he knows that he has enough,
is abiding contentment indeed.

~ Lao Tse.



 
Stock Screens: New Lows 

A stock screen to identify new 3- or 6-month Lows,
is still on our development plan.

I use % Of Price High in its place:
(1) Enter 80 as the 3-month Maximum %; or
(2) Enter 70 as the 6-month Maximum %;
(3) Submit.




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