daytrade diaries... july 22

Morning traders.

Market wrap: Stocks look set to open higher after an afternoon rally on Wall Street and a mixed night on resources markets.

U.S. indexes reversed early weakness to extend this remarkable earnings-season surge. The Nasdaq marked its 10th consecutive positive session with a rise of 0.36%, the same gain as the S&P 500. The Dow Jones was the pick of the bunch, up 0.77% after Caterpillar's profit result beat market expectations.

Financials were the main drag on the market, as the Goldman Sachs-inspired sector rally showed signs of fatigue. Bank indexes retreated 2 - 3%. Oilers managed skinny gains but there were equally slim reverses for precious metals miners and REITs. A poor profit result from Continental dragged airlines down 3%.

Crude oil futures followed US equities higher to complete a fifth positive session. Oil was recently up more than 1% at $64.72. Gold is unchanged from this time yesterday at $949. Copper hit a nine-month high in London, up 0.6%, but fell by the same percentage in US trade. Nickel, lead, zinc, aluminum and tin all marked small declines in the UK after last week's run back to this year's highs.

With 30 minutes left to trade, the SPI was up 14 points at 4043.

TRADING THEMES TODAY

TOPPING OUT? There were early signs of buyer fatigue in our market yesterday after this long rally. Some of the financials and mid-caps began to drop away and others are looking very toppy, including local indexes. Time to consider locking in profits if you haven't already. Yes, there could be more gains but the best of this rally is likely behind us.

MEDIA: Not all are day trading material but the sector is suddenly running hot, perhaps inspired by the Packer-Stokes squabble over CMJ. There were breakouts yesterday in FXJ, WAN and MCU. Also trading near recent highs: APN, SGN.

NICKEL: May be a day late with this one but MCR's quarterly activities report suggests there is still excellent profit potential in the sector - its share price surged 19.5% yesterday. PAN, IGO and WSA are all back near recent highs.

Good luck to all.