Trading Diary
November 13, 2004
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for educational purposes and should not be interpreted as
investment advice. Full terms and conditions can be found at
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USA
The Dow Industrial Average has continued to display strength since breaking through resistance at 10350: tall candlesticks, strong closes and large volume signal that buyers are in control. Expect a further test of the new support level, followed by a strong primary trend movement if successful.
The Dow Industrial Average has continued to display strength since breaking through resistance at 10350: tall candlesticks, strong closes and large volume signal that buyers are in control. Expect a further test of the new support level, followed by a strong primary trend movement if successful.
The longer-term chart displays the breakout above the
consolidation pattern. A correction that respects support at
10000 (or higher) would be a long-term bull signal. Expect some
resistance at 11000 but the next major level is 11400 to 11500.
Twiggs Money Flow signals strong accumulation, with (S/T) pull-backs respecting the signal line.
Twiggs Money Flow signals strong accumulation, with (S/T) pull-backs respecting the signal line.
The Nasdaq Composite broke through resistance at 2050
after a brief consolidation. The primary trend has completed a
large correction and reversed upwards. Strong candlesticks
and large volume signal increased momentum but expect a
pull-back, in the medium term, to test the new support
level.
Twiggs Money Flow (21-day) signals strong accumulation, with troughs (short-term and intermediate) above the zero line.
Twiggs Money Flow (21-day) signals strong accumulation, with troughs (short-term and intermediate) above the zero line.
The S&P 500 has cleared resistance at the
January/February peaks of 1160 and, after a brief consolidation
above the new support level, has surged upwards. However, we
should still expect a further test of 1160 support in the
medium-term. If successful, there are no major resistance levels
in the vicinity and we can expect good gains. The projected
target for the broadening wedge breakout is 1240: 1140 + ( 1160 -
1060).
Twiggs Money Flow signals strong accumulation.
Twiggs Money Flow signals strong accumulation.
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Treasury yields
The yield on 10-year treasury notes appears close to a double bottom breakout above 4.25%. The Wednesday Fed announcement and quarter point hike in the overnight lending rate have strengthened market expectations of further increases. A resurgence of oil prices, however, could slow the rate of increase.
The yield differential (10-year T-notes minus 13-week T-bills) remains at 2.2%. Differentials below 1.0% are bearish.
The yield on 10-year treasury notes appears close to a double bottom breakout above 4.25%. The Wednesday Fed announcement and quarter point hike in the overnight lending rate have strengthened market expectations of further increases. A resurgence of oil prices, however, could slow the rate of increase.
The yield differential (10-year T-notes minus 13-week T-bills) remains at 2.2%. Differentials below 1.0% are bearish.
Gold
New York: Spot gold consolidated in a narrow band above the new support level of $430 before surging to close at $437.40 on Friday.
Expect a further pull-back to test support at $430. If successful, we can look forward to further gains, with the next major resistance level at 500.
New York: Spot gold consolidated in a narrow band above the new support level of $430 before surging to close at $437.40 on Friday.
Expect a further pull-back to test support at $430. If successful, we can look forward to further gains, with the next major resistance level at 500.
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ASX Australia
The ASX 200 broke through resistance at 3850 before forming a doji star on Friday. Lower volumes and shorter candlesticks indicate a loss of momentum and we may be headed for another consolidation, similar to the one in October.
If the index holds above 3850 it would be a (short-term) bullish sign. A fall below 3820 would be bearish.
The ASX 200 broke through resistance at 3850 before forming a doji star on Friday. Lower volumes and shorter candlesticks indicate a loss of momentum and we may be headed for another consolidation, similar to the one in October.
If the index holds above 3850 it would be a (short-term) bullish sign. A fall below 3820 would be bearish.
Twiggs Money Flow is rising steeply, signaling strong
accumulation.
The primary up-trend is strong. The latest rally is unusually steep and at some stage (perhaps 4000) increased profit-taking will force a correction. Allow for a re-test of support at 3500 (the highs from 2002).
The primary up-trend is strong. The latest rally is unusually steep and at some stage (perhaps 4000) increased profit-taking will force a correction. Allow for a re-test of support at 3500 (the highs from 2002).
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Colin Twiggs
Plan for the difficult while it is easy;
Act on the large while it is minute.
The most difficult things in the world begin as things that are easy;
The largest things in the world arise from the minute.
~ Lao Tse
Act on the large while it is minute.
The most difficult things in the world begin as things that are easy;
The largest things in the world arise from the minute.
~ Lao Tse
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