With the AUD up at 1.09 versus the USD, it's fairly understandable. Despite all that, it's a bit hard to imagine much conviction to the selling given the way markets are running everywhere else.
This is a daily chart of the German market which has recovered strongly despite the Euro strengthening sharply against the US dollar.
11.34 A range has been established and the index is up 29. It's April expiry day for exchange traded options and that may hold most of the majors in a tight range for the rest of the day.
I'm always telling myself to do fewer and better trades and the holiday break has had me thinking about that.
Taking a critical look at the trades I have on, most of them are reasonable although only a few are compelling. Of the ones I'm in, I'm most interested in Alumina and Linc today because I can add to an existing position with a reasonably good margin of error.
Awc has had a sharp pullback after the nice run from the March sell off. I think a 3 wave retracement rally is the most likely but because there's plenty of room to the 272 high, a c wave could quite easily get to 255 rather than being a flat thing. I've bought some at 238 and my stop is at 231.
Linc is the most bullish looking of all the stocks I watch. I don't see it as a potential head and shoulders. I think that the 305 high in mid February was the completion of a move which corrected in 3 waves down to 237 at the mid March lows. Since then, the bounce to 300 looked like wave 1 which has been followed by a choppy correction. I'm hoping that correction is complete and looking for an explosive breakout through 300 as wave 3 begins. The danger - even if this is broadly correct - is that the correction chops along for some time and I have to stop out again. Nevertheless, I've bought more at 285 this morning with a stop around 274 and the chance of a range break and acceleration on the upside.
2.30 Back from a lunch and the market has drifted lower. Out of Bsl earlier at 188.5 but didn't stop out of all my Ost before I left, which was costly. Out of the last at 218 as the steels can't recover from the blow of the currency strength.
2.58 Expiry day hasn't stopped the market as I expected, the weakness has continued and the rise is just 9 points as the Aussie market reacts to higher rates and worsening terms of trade for many companies.
I cut my Fortescue hedge at 643 so I'm left with May 650 puts again. It looks like another leg down is possible.
It could, of course, find support and have another leg up. But unlike Awc, say, there's not much space for a retracement rally to push into.
I got out of my last Rsg at 123.5 because I had very little conviction about the trade.
My remaining longs are in Awc, Lnc, Pru and Tol which are all stocks with the potential for a higher low. Shorts are in Aru, Bld, Fmg and Lyc.
4.02 As the gains keep ebbing away, my conviction in any longs diminishes. I decided to stop out of Awc at 233 and Pru at 301. I can't necessarily justify it, the stocks are still above my stop, but the market seems under genuine pressure and I figure that there'll be other opportunities to buy.
4.13 The Asx 200 finished almost unchanged. Up 0.1 at 4873.
I'm still around breakeven for April, which isn't a great result, but better than how I feel which is as if I've been hammered after numerous stops. I guess I haven't let anything get out of control and that's the main thing.
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