Tail wagging the dog. Wed Jun 9

It looks like we're running ahead of US markets having pre-empted their overnight reversal yesterday. Meanwhile, we've opened stronger this morning and quickly tailed off. It's 11.34 am with the Xjo index back up a couple of points and we're having a second attempt to push on.

My short positions are performing reasonably well, while gold stocks in general are firmer despite gold having peaked early and fallen away later as the US stock indices recovered from early losses. The chart of the DJIA is interesting with a minor new low after a 4th wave correction.

It implies that the Dow is near to a short term low and as the US indices have been lagging our market slightly, I think that we're still looking good to make a higher low on the Xjo.

My featured trade today is a long in Challenger Financial. It's actually a similar sort of chart to the DJIA with no higher low, but the general shape of a short term low. I'll use around 330 as my stop. I'm long at 344 and it has firmed since then to 350.

3.06 The second attempt to bounce was just a flirtation and the market has gently slid to be down 21 points with the Japanese indices, the Hang Seng and the Kospi all weaker as well, dragging the US overnight futures lower. My Cgf long has turned back down to 340 but with the golds still firm and the short positions performing pretty well, the overall book is quite healthy.

4.14 A late squeeze left us up 4 points.