Day Trader column for November 10 - 2015

Despite last week’s market fluctuations and a weekly close below the previous week it is still looking positive and much of the current bouncing about is due to the indices coming up against the downtrend line drawn from highs earlier this year.    No weekly pivot point formed on the indices so all is still looking ok at the moment.

On Friday the All Ords and the ASX/S&P 200 both traded below the previous weeks low and the SPI contract did not come close to trading below the previous week’s low, so we have a clear divergence which indicates the real likelihood we will see the market move up this week.   Even if it is only for a short time.

Also as of Friday there is a fifty five point difference between the ASX/S&P 200 and the All Ords with the ASX/S&P 200 being the low figure.   If the market is going to break through the downtrend line, I would expect that gap to narrow, as the major stocks will need to move up if we are to see a move up in the market which as I said is still looking likely.

However, last week saw two stocks in our portfolio stopped out and as Murphy usually dictates, they may well have been sold at the bottom of the move.    You may remember I did not move the stops up as I thought I would give them a little more room to move and consolidate, but I outsmarted myself.    Had I used the raised stop the losses would have been much lower.   Still both may present another opportunity to get back into them.

Both closed below their respective stops on Tuesday November 03 and were sold the next day.

Ramelius Resources (RMS) closed at 20c and was sold as the market opened the next day at 18.5c for a total of $7,380 after brokerage.    It has not reversed as yet, but it did find support at 18c which was the spike low formed on October 09, so I will just have to wait and see how it behaves from here.   I might add that last week it formed a weekly pivot point to the downside, so I will now have to wait for it to form a weekly pivot point to the upside before considering buying it again.

St. Barbara (SBM) closed below its stop and was also sold, as it turned out, at the low of the current move down.    It was sold at $1.21 for a total of $8,450 after brokerage.    Unlike RMS, in the case of SBM it was sold at a considerable profit.    It also formed a weekly pivot point to the downside last week, so it too will need to form a weekly pivot point to the upside before going back on my watch list.   If it does have another move up it will find resistance between $1.80 and $2.00 and that would be where I would take profit and wait to see if it was likely to break that level, and continue to move up to the next resistance level around $3.00.

Saracen Mineral Holdings (SAR) continued to trade around 56c, and a close below 56c will see it sold too.

Appen Ltd (APX) has moved up strongly and I will look at possibly taking profit around $1.75   

 

Past columns, information and DVD’s on my methods are available at:-             www.thedaytrader.com.au             

Portfolio Position

 

Stock

No. of Shares

Purchase price

Stop

Fridays Close

APX

5,000

$1.11

$1.35

$1.575

SAR

10,000

57.5c

53c

56c

 

Cash       $314,459

Shares    $13,475

Total      $327,934