Trading Diary
April 9, 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 retreated 1.2% to 8197 on higher volume.
The intermediate trend is down. A rise above the recent equal highs at 8552 will signal reversal to an up-trend; a fall below 7903 will signal continuation.
Monday 17th's follow through signal remains valid (as long as the index holds above 7763).
The primary trend is down.

The Nasdaq Composite fell 1.9% to 1356.
The intermediate trend is down. A rise above the equal highs at 1430 will signal a reversal; a fall below 1336 will signal continuation.
The primary trend is up.

The S&P 500 lost 12 points to close at 865.
The intermediate trend is down, until the index breaks above 904.
The primary trend is down.

The Chartcraft NYSE Bullish % Indicator is at 46% (April 8), after completing a Bull Correction buy signal. 

Iraq
Iraqi Information Minister Mohammed Saeed al-Sahaf failed to appear for his daily briefing; a clear sign that his government has lost control of Baghdad. (more)

News Corp
News Corp acquires a controlling stake in DirecTV; a key step in their strategy to build a global satellite TV network. (more)

ASX Australia

The All Ordinaries retreated to 2916 on lower volume.
The intermediate up-trend continues. The strength of the latest correction (volume, duration and volatility) will indicate whether the trend is likely to continue. 
The primary trend is down.

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

Strategy

Short-term: Long if the index rises above 2947 (keep stops tight in case of a false break above the long-term trendline); short if the intermediate trend reverses down.

Intermediate: Long if the primary trend reverses up (XAO above 3062); short if the intermediate trend reverses down.
Long-term: There are already two bull signals: the March 18 follow through and April 3 Bullish % signal. Wait for confirmation from the primary trend reversal.

Capral Aluminium [CAA]
Last covered on March 5, 2003.
After establishing a broad base CAA broke out in May 2002 to commence a creeping up-trend. In February 2003 the stock broke its upward trendline and threatened to re-test support at 1.80. But price has held above support at 2.60 for more than a month and Twiggs Money Flow (100-day) shows a bullish divergence.

Relative Strength (price ratio: xao) shows short-term weakness, while MACD is rising.

The daily equivolume chart shows equal lows at [2] and [4], a bullish sign in an up-trend. Both lows closed back above 2.70 and [4] is on weak volume. Strong accumulation at [3] confirms the Twiggs Money Flow signal. A break above resistance at 2.85 will be bullish, with an immediate target of 3.19 [1].

A break below 2.60 would be a bear signal.

Colin Twiggs

Nothing in the world
is as soft and yielding as water.
Yet for dissolving the hard and inflexible,
nothing can surpass it.

The soft overcomes the hard;
the gentle overcomes the rigid.
Everyone knows this is true,
but few can put it into practice.

- Lao Tse.

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