St Barbara re-rating. Mon Mar 7

It's still on a knife edge in the States with indices falling back again. European markets closed when the US was close to the worst so the charts strengthen the strong odds of a second leg down but haven't yet confirmed it.
After 70 minutes of trading, the Asx 200 is down 40. It was resilient early, holding the losses to about 20,25 points, but has just capitulated.
Gold rose about USD 15 in Friday's overnight session but it doesn't always follow through to stock price gains the next trading day. Today it has and one of the best performers is St Barbara. It's starting to accelerate away from a reverse head and shoulders pattern and has lots of value. It was slammed in late 2010 on the back of some production problems but management is competent and the issues are largely resolved which leaves the stock providing relative value. Their presentations are excellent and a London presentation might have brought through some buying. Here's the daily; it's up 9 at 222.

11.25 Also in the gold space is Resolute. This has been disappointing lately as, like Sbm, it has been punished for cutting production forecasts. I've gone long at a tick or two under 131. My scenario is that Friday's reversal was a completion of the retracement with trades above Friday's high being the entry signal. If I'm wrong, the stop is around 125.

Aristocrat is up 16 at 334 so I needn't have been so conservative on that one. Let a couple go at 333 which I could have bought back in the high 320s. Wish I had now, it's starting to look explosive.....but it hasn't got through the resistance yet.

11.50 That was quick; just bought back a few Aristocrat at 328. I thought the market might hold at down 40 but it's edging down again and is close to filling the gap created by Friday's 59 point rise.

I'm out of the last couple of Newcrest calls at 215 as the stock is petering out after some early follow through from Friday's rise.

I cut my Fmg long from Friday at 657 which was a tiny profit and added to the Lynas short this morning at 220; they're at 215 and I'm buying some back because it's just a quick short into an overbought situation which has tipped over.

I've been quite active lately, bought back some Bld shorts from Friday at 538 and selling out a few more of the Mar 541 puts at 13.5; shorting some Cgf at 492 and Pdn at 507; buying back a few Awc at 242 and Osh at 681 etc etc and that's just the short positions.

12.59 The selling is continuing and the index has given back Friday's gains, sitting just above 4800 at 4805, down 59.

I've sold more Boral puts at 16 but also shorted some stock at 535 as it starts to resume the short term downtrend.

Aristocrat is a tricky one, it's back at 326 and the possibility of a second failure at resistance is quite high. I may still tip this out today.

1.29 Decided All is too hard and sold at 326. Sold out the last of my Regis gold at 222 but would like to re-enter on a pullback. Bought some Lnc back at 292 and some Bld at 530.

1.40 Feeling a bit naked with only two gold longs so added a small amount of Intrepid at 198.5. As with Rsg, I think there's a good chance of a completed a-b-c correction. Stop is again below the Friday low.

2.17 No relief from the selling yet with the market below 4800, down 68.

Bought back a few things, including some Cgf at 480. I'm also more confident about being short Alumina as it now looks as if the correction is over. Added to the short at 240. Execution hasn't been great but another leg down to 225-230 will more than make up for that.

Gold and oil are quite firm in the Asian session.

3.46 Out of the top 20 stocks, just Ncm and Amp have risen and the rest are down. When the weakness is focussed in the most liquid stocks, it implies some serious selling. I'm a little surprised, if the Asx 200 falls below last week's low there are still two decent support levels fairly close.

3.58 It's a bit counterintuitive, what with oil surging, but Oil Search is looking quite weak. I bought back some of my short stock at 680ish but added some April 675 puts at 17. Today's drop through the last swing low at 682 made a sell signal.

4.15 The index failed to close above 4800, finishing 1.4% lower at 4798.

It was a pretty good day again with the golds doing well. Linc was the fly in the ointment, I bought a little stock on the back foot at 292 and 288 and it eventually closed at 285.

Aristocrat closed at 321 which was still up 3 on the day but I'm glad to be out. Failures to break out can be really volatile and although this is hanging in the balance, the volatility is certainly there.