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Trading Diary
March 6, 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 formed an inside day, losing 1.3% to close at 7673 on
average volume. The intermediate cycle is down; the next support
level is at 7500.
The primary trend is down.
The Nasdaq Composite closed 8 points lower at 1302. The intermediate trend is down, with the next support level at 1200.
The primary trend is up.
The S&P 500 formed an inside day, down 7 points at 822. The intermediate trend is down.
The primary trend is down; the next support level is at 768.
The Chartcraft NYSE Bullish % Indicator is at 40% (March 5).
The primary trend is down.
The Nasdaq Composite closed 8 points lower at 1302. The intermediate trend is down, with the next support level at 1200.
The primary trend is up.
The S&P 500 formed an inside day, down 7 points at 822. The intermediate trend is down.
The primary trend is down; the next support level is at 768.
The Chartcraft NYSE Bullish % Indicator is at 40% (March 5).
Intel
The chip-maker narrowed its sales forecasts, cutting the high end off its previous guidance. (more)
The chip-maker narrowed its sales forecasts, cutting the high end off its previous guidance. (more)
Gold
New York (18.14): Spot gold climbed 350 cents to $US 356.10.
New York (18.14): Spot gold climbed 350 cents to $US 356.10.
ASX Australia
The All Ordinaries closed down 3 points at 2747 on lower volume.
The index has broken below the 2850 to 2779 support band. Unless
there is an immediate reversal, it is likely to weaken further.
The next support level is just below 2400, and the target for the
double top pattern is 2200.
Slow Stochastic (20,3,3) has crossed below its signal line; MACD (26,12,9) is below. The small divergence on Twiggs Money Flow has ended; the indicator signals distribution.
Slow Stochastic (20,3,3) has crossed below its signal line; MACD (26,12,9) is below. The small divergence on Twiggs Money Flow has ended; the indicator signals distribution.
Adelaide Brighton [ABC]
Last covered on December 14, 2002.
After forming a broad base in 2000/2001, ABC commenced an up-trend at [A]. This was followed by a period of consolidation which included a cup and handle at [C] - [E] - [F]. The up-trend resumed, but now we have a break below the supporting trendline at [G].
Relative Strength (price ratio: xao) is rising, but 21-day Twiggs Money Flow and MACD show bearish divergences.
Last covered on December 14, 2002.
After forming a broad base in 2000/2001, ABC commenced an up-trend at [A]. This was followed by a period of consolidation which included a cup and handle at [C] - [E] - [F]. The up-trend resumed, but now we have a break below the supporting trendline at [G].
Relative Strength (price ratio: xao) is rising, but 21-day Twiggs Money Flow and MACD show bearish divergences.
On the equivolume chart, ABC formed a hammer reversal after
breaking below the trendline at [2], closing back at the
trendline. According to Portmacquarie on the Chart Forum,
the tail was caused by two trades at 11.00 a.m. totaling 60,000
shares.
That was sufficient to spook the market and day [3] saw an inside day on strong volume, closing well below the supporting trendline.
Price gapped down on day [4] on fairly strong volume but the weak close signals short-term exhaustion and is likely to be followed by a test of resistance levels.
That was sufficient to spook the market and day [3] saw an inside day on strong volume, closing well below the supporting trendline.
Price gapped down on day [4] on fairly strong volume but the weak close signals short-term exhaustion and is likely to be followed by a test of resistance levels.
A break below 0.98 will confirm that ABC is in a strong
down-trend.
Market strategy
For further guidance see Understanding the Trading Diary.
For further guidance see Understanding the Trading Diary.
Short-term: Short. Slow Stochastic and MACD are below their
respective signal lines.
Medium-term: Avoid new entries.
Long-term: Wait for confirmation of the
bottom reversal signal.
Colin Twiggs
Things should be made as simple as possible,
but not any simpler.
- Albert Einstein
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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.