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Trading Diary
August 22, 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 retreated 0.8% to 9349. Higher volume signals selling pressure. The index has broken out of its narrow trading range and is now testing the new 9350 support level.
The intermediate trend is up.
The primary trend is up.



The Nasdaq Composite made a false break above the July high before closing down 13 points at 1765 on average volume.  Equal highs in an up-trend are not particularly bearish - unless the index falls below the intervening low of 1640.
The intermediate trend is up.
The primary trend is up.


 


The S&P 500 reversed downwards to 993 on lower volume.
The intermediate trend is down.
The primary trend is up.



The Chartcraft NYSE Bullish % Indicator has risen 1.62% since last week, closing at 76.71% (August 22).

Market Strategy
Short-term: Long if the S&P500 is above 1000. Short if below 993.
Intermediate: Long if S&P 500 is above 1015. Short if below 960.
Long-term: Long is the index is above 960.


Intel raises guidance
In a bullish move, the chip-maker raised its sales guidance for the third quarter by +/- 5%. (more)

Treasury yields
The yield on 10-year treasury notes retreated slightly to 4.46% on Friday.
The intermediate and primary trends are both up.





Gold
New York (13.30): Spot gold retreated slightly (50 cents) over the week, to close at $362.60.
The primary trend is up.



ASX Australia
The All Ordinaries broke out of the small, bullish pennant, closing at 3180 on strong volume.



The weekly chart shows healthy intermediate and primary up-trends. 

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



Market Strategy
Short-term: Long if the All Ords is above 3160. Short if the intermediate trend reverses.
Intermediate: Long if the index is above 3160.
Long-term: Long if the index is above 2978 .

Sector Analysis
Changes are highlighted in bold.
  • Energy [XEJ] - stage 2 (RS is rising).
  • Materials [XMJ] - stage 2 (RS is rising)
  • Industrials [XNJ] - stage 1 (RS is level)
  • Consumer Discretionary [XDJ] - stage 2 (RS is rising)
  • Consumer Staples [XSJ] - stage 1 (RS is falling)
  • Health Care [XHJ] - stage 2 (RS is rising)
  • Property Trusts [XPJ] - stage 2 (RS is falling)
  • Financial excl. Property Trusts [XXJ] - stage 2 (RS is falling). 
  • Information Technology [XIJ] - stage 1 (RS is rising)
  • Telecom Services [XTJ] - stage 2 (RS is rising).
  • Utilities [XUJ] - stage 2 (RS is falling)

The Financial-X-Property index [XXJ] has formed a triangle in a stage 2 up-trend; normally bullish, but Relative Strength is falling.



Sectors: Relative Strength
A stock screen of the ASX 200 using % Price Move (1 month: +5%) increased to 87 stocks (compared to 131 on April 11, 2003; and 8 on March 14, 2003).
  • Diversified Metals & Mining (7)
  • Gold (6)
  • Oil & Gas Exploration & Production (4)
  • Diversified Commercial (4)
  • Health Care Facilities (3)
  • Diversified Financial (3)
  • Auto Parts & Equipment (3)
  • Agricultural Products (3)

Daily Trading Diary
Stocks analyzed during the week were:
  • Kingsgate - KCN
  • Sons of Gwalia - SGW
  • Great Southern Plantations - GTP
  • Adelaide Brighton - ABC
  • Computershare - CPU
  • Challenger - CFG





Understanding the Trading Diary has been expanded to offer further assistance to readers.

Colin Twiggs


Those who lament their misfortunes are generally they who do not recognize their opportunities.

~ SA Nelson: The ABC of Stock Speculation (1903).




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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.