Trading Diary
July 17, 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 rallied but then lost most of its gains to close up 0.8% at 8542 on strong volume. The next key support level is 8000. This is a bear market, with primary and secondary cycles trending down.

The Nasdaq Composite rallied 1.6% to 1397. Support is at 1357, from October 1998.
The primary and secondary cycles are in a down-trend.

The S&P 500 rose 6 points to close at 906, below the October 1998 support level of 923.
Primary and secondary cycles trend downwards.

 
IBM
The big blue recorded second-quarter earnings per share of 84 cents before restructuring charges of 81 cents per share. (more)
 
Intel's dilemna
 Making ever-faster chips, the company is outpacing demand driven by more powerful software applications. (more)
 
Coke fizzes
Second-quarter earnings were up 15%. (more)
 
ASX Australia
The All Ordinaries closed at 3073, more than 1% down, on above-average volume.
The primary cycle is in a bear trend. The secondary cycle has resumed its down-trend.
MACD (26,12,9) and Slow Stochastic (20,3,3) are below their respective signal lines.
Exponentially-smoothed Money Flow signals distribution.


Consumer sentiment
July consumer sentiment is down a modest 2.7% at 109.9. (more)
 
Woolworths [WOW]
The stock retreated on concerns that the group has exhausted it growth options. (more)
Relative Strength (price ratio: xao) and MACD are weakening, while exponentially-smoothed Money Flow is still positive.


Brambles [BIL]
Brambles stock slumps on concerns over their US pallet business. (more)  
Relative Strength (price ratio: xao) and MACD are weak but exponentially-smoothed Money Flow shows a bullish divergence.


 

AurionGold [AOR]
Interest in gold stocks, particularly AOR, is waning.
Relative Strength (price ratio: xao) and exponentially-smoothed Money Flow are weakening, while MACD is negative.


 




Conclusion
 
Short-term: Short in selected sectors. The Slow Stochastic and MACD are below their respective signal lines.
Medium-term: Wait for the All Ords to signal a reversal.
Long-term: Wait for a bull-trend on the Nasdaq or S&P 500 (primary cycle).
 
Colin Twiggs
 
Thought for the Day:
A man may know what to do and lose money - if he doesn't do it quickly enough. - Edwin Lefevre
 
 




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Colin Twiggs

Author: Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He co-founded Incredible Charts and writes the popular Trading Diary and Patient Investor newsletters.

Using a top-down approach, Colin identifies key macro trends in the global economy before evaluating selected opportunities using a combination of fundamental and technical analysis.

Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.

He founded PVT Capital (AFSL No. 546090) in May 2023, which offers investment strategy and advice to wholesale clients.