Crunch week. Mon Nov 16

We're back up again this morning after a solid rise overnight and the index at 11.20 am has rallied 1% which is slightly more than Friday's fall.

The Xjo index made a new low this month but the first leg of the bounce back was impressive. My take is that we may well get a new high on the index as we form an expanding top.If Friday's low turns out to be a pivot point then wave equality would take us to a new high quite comfortably. However, a clear new low such as we got early this month relative to October's low is significant so I think that, new high or not, time is running out for the bull run.

Many of the individual charts parallel that of the Xjo index and I've gone long or topped up existing longs in a few stocks.

First up though, I was a little too conservative in Cgf as it gapped open this morning. I tried to buy on the open at 407 - versus a close of 403 - but I was too conservative as it gapped to 412 and pushed as high as 425 before settling around 420. Although it wasn't completely clear on the daily chart, the 60 minute chart suggested that - on that scale - it was early in a 3rd wave and hence I could have left some of my position running. I'm not altogether bothered, with a bit of luck I might have managed to get long this morning at a good level to compensate for the oversight. For example, if the market was opening flat it probably would have done much the same thing but without such a big opening gap.

11.32 First of all, Arrow Energy. I erred on the cautious side last week and sold out with a trailing stop because my entry had been late. This turned out to be wise and this morning I've bought about half of my position as I'm toying with the idea of it having made a higher low. Long at 395 and it has ticked down since then to 393. I'd like to see this close towards the highs of the range and I'll hold off buying more till I'm confident of that.

Bsl got whacked on Thursday last week as the chairman's address hosed down profit expectations and a raft of analysts were forced to cut their forecasts. Most of them still rate the stock as a buy albeit with a lower target and I've gone long on a potential reversal at 290 and 291. I am wondering, though, whether there's enough serious buying as the action today isn't altogether convincing.

Ipl is much easier. I bought last week at 262 and sold out about half, as a compromise, in the low to mid 270s. It reported this morning and gave a reversal buy signal so I took it back up to a full position with more stock at 268. It's up to 274 now as it rallies post its full year report.

I've also gone long the other steel stock in my watchlist, Onesteel, as I try to pick a reversal and again, I might have been too gung-ho, as it's not too far to a clear 1-2-3 breakout; 319. Long at 314 and it's 313 now as the market has slipped 25 points from the 11 am high. 1.14 I've just cut Onesteel, above, at 308 (v 314). Not something I like to do, but it was an incautious buy and with Bsl looking good now at 293, it looks more and more as if there's a switch out of Ost going on. When I looked at analyst targets for Bsl, the numbers were well above the present price while Ost was trading at only a small discount to expectations.

2.30 Bought the rest of the Aoe to average 396 as the stock is firming on good volume.

4.10 The market steadied and firmed to close towards the day's highs and it looks like there's room for more tomorrow. To that effect, although I had the opportunity to close out a couple of stocks, I decided to only sell half, mindful of the acceleration in Cgf today. So, I sold half my balance in Cey at 348 (v 328), Fmg at 425 (v 402), Ozl at 128.5 (v 120.5) and Sgp at 409 (v 385.5). Here's the chart for Fmg as an example. My general idea is to sell the next new high after a swing against me but in all these cases I think there's a strong chance that the open tomorrow will be stronger.

A good day all round with my two short positions slightly weaker as well. I was trying to buy back a few Gff on the close on the new-low-after-a-swing approach but just missed out on the match.