Trading Diary
May 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 .




USA
The Dow formed an inside day, showing uncertainty, closing down at 10243 on strong volume.
The primary trend is down, secondary - up and short trend - up.

The Nasdaq Composite held on to its gains, closing at 1725.
The primary cycle is forming a base (or stage 1), secondary trend - down, while the short trend is up.
 
The S&P 500 closed 6 points down at 1091.
Primary cycle - the base still shows weakness, secondary trend - down and short cycle - up.
 
AOL Time Warner
Merrill Lynch analyst Reif Cohen goes against the herd, upgrading AOL to a "buy" rating. (more)
 
K-Mart
The bankrupt retailer recorded a $US 2.4 billion loss for the fiscal year. (more)
 
ASX Australia
The All Ords rocketed 1.9% to close at 3325 on strong volume.
Chaikin Money Flow continues to show a bullish divergence, while MACD (26,12,9) and Slow Stochastic (20,3,3) have crossed to above their signal lines.


NewsCorp [NCP]
 News Corporation Limited stock surged 15% as the market ignored the large investment write-downs and focused on stronger than expected underlying performance. (more)
 NCP is in a stage 4 decline, having under-performed the market since October 2000. Price has gapped up, accompanied by strong volume, but the secondary cycle is still in a down-trend.  


Open Telecommunications
The managing director and chief financial officer both resign. Trade in Open shares was halted last month pending the outcome of a legal dispute with Comindico. (more)
 




Conclusion
 
Short-term: My concern is that the rally may not be able to sustain itself. Long using trailing buy-stops. Maintain tight stop-losses.
Medium-term: The All Ords has not yet formed a base.
Long-term: Wait for the Nasdaq or S&P 500 to break out from their bases (trading ranges).

Colin Twiggs



P.S. We are trying out new Email software. Please report if you experience any problems with the trading diary.

Please forward this to your friends and colleagues.




Back Issues
Click here to access the Trading Diary Archives.






Back Issues
Access the Trading Diary Archives.