My main scenario is that this is an abc rally with wave a just completed. I was trying to be clever when I got hung up on the idea of a large V bottom rally which is pretty unusual. As it was, it was a decent enough first bounce off the lows and I don't expect a rush back there soon.
I'm out of Awc at 146.5 which is not too much damage and meanwhile, I don't want to rush into shorts as I've missed the boat. That is, if I'm only looking for a little b wave retracement over the next few days, then I had to be pre-emptive in putting on shorts and as I discussed late last week, the best opportunities were in the iron ore sector. Actually, gold stocks were also good potential shorts, but I missed them too - although with good reason, there's not enough to trade with the Lgl/Ncm merger coming up soon and the others quite whippy. Probably I should just keep trading Lgl through August as the merger is not due till September.
Good news for today is that Linc might have had it's pullback after Wednesday's spurt on asset sale news. There were a few sales around 118 but the stock has quickly reversed on decent volume to be up a cent or two at 126.5. I've bought more in the low 120s.
1.47 The index is holding reasonably well as Chinese and Korean markets outperform. With the exception of Linc this morning, I don't see that stocks have fallen far enough to tempt me to buy more and on the short side, although I've got Qan, Tls and Tse on a list of potentials, the risk/reward doesn't seem good enough. So I'm sitting on my hands really with only two positions, both long, in Lnc and Ost.
4.37 No further action. The interesting performance today was the Shanghai market, up 2% and showing signs of quite a good buy signal after a long period of weakness. If it can push through resistance (and previous support) at around 2500, then it should have a decent little rally. It would also be a pretty good buy indicator for Aussie resource stocks.
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