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Trading Diary
September 3, 2003

These extracts from my daily trading diary are for educational purposes and should not be interpreted as investment advice. Full terms and conditions can be found at Terms of Use .




USA
The Dow Industrial Average gained a further 0.5% to close at 9568 on higher volume, continuing to make new 1-year highs.
The intermediate trend is up.
The primary trend is up.
Twiggs Money Flow and MACD are both bullish.



The Nasdaq Composite gapped up 12 points at 1853, forming a doji star on strong volume. The pattern signals a reversal if there is a close more than half way down the body of the previous bar (i.e. below 1829).
The intermediate trend is up.
The primary trend is up.



The S&P 500 gained 4 points to close at 1026 on strong volume.
The intermediate trend is up.
The primary trend is up.



The Chartcraft NYSE Bullish % Indicator continues to rise, reaching a new ten-year high of 78.98% (September 3).

Market Strategy
Short-term: Long above 1022.
Intermediate: Long if the index is above 1015.
Long-term: Long if the index is above 960.


Cars sales zoom
Domestic vehicle sales are well above forecasts, a healthy sign for a recovery. (more)

Treasury yields
After consolidating above its new support level, the 10-year treasury note yield held at 4.60%.
The intermediate and primary trends are both up.




Gold
New York (20.21): Spot gold is 3 dollars up at $374.20.
The primary trend is up.
Price has broken above a symmetrical triangle, with a target of 420. There is still some resistance at 382.




ASX Australia
The All Ordinaries formed a gravestone candlestick, reversing after an early rally to close down 5 points at 3219 on strong volume. Heavy volume often precedes a correction, so we need to be on the alert. Positive performance of US markets may negate this.



The intermediate trend and primary trend are both up.

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

Market Strategy
Short-term: Long if the XAO is above 3237.
Intermediate: Long if the index is above 3162.
Long-term: Long if the index is above 2978 .

Property sector
The Property index [XPJ] threatens to break below its long-term upward trendline. The trendline is only a momentum indicator and a reversal to a stage 4 down-trend will only take place when price breaks through support at 1400.
Relative Strength has fallen to a new 1-year low.



Twiggs Money Flow (100) displays a bearish divergence, while MACD has completed two bearish peaks below zero.



The daily volume chart shows a surge in volume at [1] as price rallies above the support level.
Weak closes and high volume at [2] signal distribution.
The fast rally at [3] is accompanied by strong volume.
After a failed attempt to break above the previous high, price retreats to [4]. The weak close and high volume signal accumulation at the 1532 support level.
The next rally starts with heavy volume at [5] but fades to low volume at [6]; a false break above the previous high.
Price has since retreated on light volume, falling through several support levels, before pausing briefly at the long-term trendline. Volume has given no sign of a reversal.
The true test will come at 1400.



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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


You are neither right nor wrong because the crowd disagrees with you.
You are right because your data and reasoning are right.

~ Warren Buffet




Setting up a Watchlist
The quickest way to set up a watchlist is to use the Stock Screen menu. To create a watchlist of the ASX 50:
  1. Open the Stock Screen page and click the Reset button;
  2. Select ASX 50 under Indexes & Watchlists;
  3. Submit;
  4. Right-click on the return page and select Create Watchlist Automatically Adding All Securities;
  5. Enter a watchlist name and click OK.
You will now have a watchlist of the ASX 50. You can add and delete individual stocks as you please.



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You can now view back issues at the Daily Trading Diary Archives.


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