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Trading Diary
October 16, 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 Industrial Average continued to decline, closing slightly
lower at 9792. Lower volume signals trend strength. Expect
support at 9660.
The intermediate trend is up.
The primary trend is up. A fall below 9230 would signal reversal.
The intermediate trend is up.
The primary trend is up. A fall below 9230 would signal reversal.
The Nasdaq Composite reversed direction with a weaker
closing price reversal, closing 11 points higher at 1950 on
lower volume.
The intermediate trend is up.
The primary trend is up.
The intermediate trend is up.
The primary trend is up.
The S&P 500 formed an inside day, gaining 3 points to close
at 1050 on lower volume; a continuation signal.
The intermediate trend is up.
The primary trend is up.
The intermediate trend is up.
The primary trend is up.
The Chartcraft NYSE Bullish % Indicator increased
to 81.75% (October 16).
Market Strategy
Short-term: Bullish if the S&P500 is above 1043.
Intermediate: Bullish above 1043.
Long-term: Bullish above 990.
Short-term: Bullish if the S&P500 is above 1043.
Intermediate: Bullish above 1043.
Long-term: Bullish above 990.
Production rises
The Fed reports that industrial production rose 0.4% in September, against 0.1% in August. (more)
The Fed reports that industrial production rose 0.4% in September, against 0.1% in August. (more)
Jobless claims lower
New unemployment claims fell to 384,000 last week, compared to a revised 388,000 the week before. (more)
New unemployment claims fell to 384,000 last week, compared to a revised 388,000 the week before. (more)
Treasury yields
The yield on 10-year treasury notes climbed to 4.46%.
The intermediate trend is up.
The primary trend is up.
The yield on 10-year treasury notes climbed to 4.46%.
The intermediate trend is up.
The primary trend is up.
Gold
New York (20:56): Spot gold eased to $371.00.
The intermediate trend is down.
The primary trend is up, with support at 343 to 350.
New York (20:56): Spot gold eased to $371.00.
The intermediate trend is down.
The primary trend is up, with support at 343 to 350.
ASX Australia
The All Ordinaries formed a small
pennant, closing up 10 points at 3302. The pennant normally
signals continuation but unusually high volumes and narrow ranges
warn of strong selling pressure.
The intermediate trend is up.
The primary trend is up. The rally is extended after 3 secondary corrections back to the trendline; the probability of a reversal increases with each consecutive rally.
MACD (26,12,9) is above its signal line; Slow Stochastic (20,3,3) is below; Twiggs Money Flow (100) is below its signal line having completed another bearish divergence.
The primary trend is up. The rally is extended after 3 secondary corrections back to the trendline; the probability of a reversal increases with each consecutive rally.
MACD (26,12,9) is above its signal line; Slow Stochastic (20,3,3) is below; Twiggs Money Flow (100) is below its signal line having completed another bearish divergence.
Market Strategy
Short-term: Bullish if the All Ords is above 3307.
Intermediate: Bullish above 3250.
Long-term: Bullish above 3160. Tighten stops (to intermediate level) when the secondary rally ends.
Short-term: Bullish if the All Ords is above 3307.
Intermediate: Bullish above 3250.
Long-term: Bullish above 3160. Tighten stops (to intermediate level) when the secondary rally ends.
Banks
Last covered July 22, 2003.
The major banks have lost momentum since their upward drive in the first half of the year and now appear headed for a re-test of support levels.
Last covered July 22, 2003.
The major banks have lost momentum since their upward drive in the first half of the year and now appear headed for a re-test of support levels.
National Australia Bank [NAB] formed an unstable V-bottom at the
start of the year before rallying to 34.00. Price has formed a
weak head and shoulders pattern at [1], [2] and [3]; weak because
the neckline has an upward slope. The primary trend has reversed
downward after [3], with a fall below the previous low. Twiggs
Money Flow (100) signals distribution. Relative Strength (price
ratio: xao) continues to fall and a reversal of the secondary
retracement, while below the previous low (32.00), will be
a strong bear signal.
ANZ Bank [ANZ] has also completed a primary trend reversal, with
a break below the previous low after a lower high at [3]. A
reversal of the upward retracement at/below the high of [3] will
be a strong bear signal: equal highs below a higher high. Twiggs
Money Flow (100) signals distribution. Relative Strength (xao): a
fall below the August low will be a strong bear signal.
Commonwealth Bank [CBA] has yet to make a primary trend reversal,
consolidating around the 28.00 level after a low at [1]. Twiggs
Money Flow (100) signals distribution and Relative Strength
(price ratio: xao) is falling. A fall below 27.28, the low of
[1], will be a strong bear signal.
Westpac [WBC] encountered resistance at 17.00, the earlier high
from February 2002. Price then tested support at the previous low
before again rallying. The primary up-trend is still intact.
Twiggs Money Flow (100) is still above zero signaling
accumulation, but it may be difficult to overcome resistance at
17.00, considering the weak performance of the other 3
banks.
Relative Strength (price ratio: xao) is declining and a fall
below the August low will be a strong bear signal.
Understanding
the Trading Diary has been expanded to offer further
assistance to readers, including
directions on how to search the archives.
Colin Twiggs
Live your life so that whenever you lose, you're
ahead.
~ Will Rogers, cowboy humorist (1879 - 1935).
~ Will Rogers, cowboy humorist (1879 - 1935).
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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.