Darryl Morley
June 03, 2009 12:00am
LAST Friday saw our market form a daily pivot point, and as many stocks formed buy signals during the week I expect the index is about to move up another level.
That should see the All Ords move to around 4200 before the next pause.
As mentioned last week, I sold 10,000 Eastern Star Gas (ESG) on May 25 at 79 for a total of $7880 and 30,000 Comet Ridge (COI) at 42 for a total of $12,570.
Norton Goldfields (NGF) closed below its stop on May 28 and was sold next day at 21 for a total of $4180.
I bought three stocks on May 28 -- two of which I was recently stopped out of and had been watching for them to begin their next move up.
Terramin Australia (TZN) was sold on May 14 after it broke its stop. After another two weeks of trading below my stop it formed a daily pivot point and closed above 70. I bought 10,000 at 71 on May 28 for a total of $7120. The initial stop is 63.5. If and after it moves above 87, the next target is $1.20.
I also bought 7000 Berkeley Resources (BKY) at $1.03 for a total of $7230. Initial stop is $1. I will use trailing stops until it reaches $2 when I will sell then wait to see how it behaves.
Also on May 28, I bought 1500 Karoon Gas (KAR) at $6.17 for a total of $9275. Initial stop is $5.50 and the first target is the recent high of $8. If it moves higher, the next target is around $11.50.
On May 29 I bought 5000 Centamin Egypt (CNT) at $1.64 for a total of $8220. Stop is $1.565 and target $2.70.
On Monday I bought 10,000 ESG, 7000 Oil Search (OSH), 20,000 Exoma Energy (EXE) and 1500 Riversdale Mining (RIV).
I have bought and been stopped out of ESG on two occasions now and if I get stopped out again it will be a very tough decision to buy it back a fourth time.
I bought ESG this week because it is still set up to move to record highs. Moves to new highs provide me with great trading opportunities because at new highs, there is no hard resistance.
I define hard resistance as levels above the present price where investors who bought as the price moved down are motivated to sell, because they are looking to just get their money back.
If there are not enough sellers to reverse the move up and the price moves higher, hope takes over and investors now think they will make a killing and are loath to sell.
The stop on Medusa Mining (MML) was moved up to the top of the sideways consolidation formed during April and May which is also the top of the gap formed as the price broke out of this sideways range.
Portfolio Position
Cash: $135,786.
Shares: $79,685.
Total: $215,471.
(Initial stake in July 2006 of $50,000.)
Email: [email protected]
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