Cautious optimism. Wed Aug 19

My take on the Xjo holding support is working so far. After a slightly better than mild recovery in US and European indices last night, we're up 33 points just before noon although we're 20 odd points off intraday highs.


Straits resources opened well at 250 but quickly peeled back and I got out at 242 (v 241). It was the sort of pattern where I was expecting a wave 5 type run up to new highs. I was hoping for 260 but 250 was the limit and the reversal came quickly. A failed new high after a breakout of a fairly lengthy consolidation is a clue to be impatient and get out. So, although I'm trying to hold most positions for longer, this is not one of the times when I'm selling out for the wrong reasons.
I sold out of a residual position in Gff at 148 (v 146). This is a stock which will, I think, run again but it's the third day down and I could easily have cut on Monday. I've also got out because I wanted to use the capital on a couple of new positions.
I also sold out of Eld for square at 40 as it enters the 6th day of consolidation. It's still of interest but I'll wait for a fresh signal before I buy.
Ok, the new positions are in diversified minerals producer OM holdings and Telstra.
Omh has been running strongly and looks to have completed a bullish pennant shaped correction. It bounced yesterday and has continued today. Long at 190.




Telstra, long at 370, is harder for me to buy because it has been an underperformer for so many years but it has broken out of a consolidation and appears to be technically strong. For example the move away from the 340 level in late July consolidated in a very tight range and the shape of the chart is changing as the 30 day moving average shows; it looks like we're moving into an acceleration phase.

2.24 Not much to report except that Gff reversed up and gave me a signal to get back in. Gritted my teeth and paid 150. The good thing is that I've got a full size position now and since it's trading at 151 I'm not far behind despite the chopping around.

4.10 Unfortunately the market has reversed and with it went Telstra. I'm starting to worry that I'll get the scenario I described earlier in Straits Resources - which opened at 250 and looks like matching out at 230. ie a new high on a clean breakout followed by a reversal. So I'm cutting straight away...out at 365 (v 370). Otherwise, most of my book held up with Ppx closing on its highs. I bought and sold a few extra Ppx again which covered some of the Tls loss.