Daytrading May 25 afternoon

Thanks Brit and morning crew.


Half-time round-up:

Australian shares turned positive for the week as Wall Street's strongest session in three months swept Asian indices higher this morning.  

At 1pm EST the ASX 200 was 92 points or 1.7% higher at 5387, erasing two days of losses and positioning the market for a possible seventh straight weekly advance for the first time since January 2013. A broad rally was led by the energy sector +2.7%, financials +2.1% and telecoms +2%. The gold sector was alone in missing the uplift, sliding 3.9% as the US dollar neared a two-month high.

US stocks surged overnight after strong housing data eased fears that the economy was losing momentum as the Federal Reserve prepared to raise rates.

“Strong US home sales have added credence to the Fed’s claims that the US economy may be strong enough for another rate hike in June or July,” Angus Nicholson, market analyst at IG, told Bloomberg. “Commodities have been remarkably buoyant overnight given the strong performance in the dollar.”

Asian markets rumbled higher as US equity futures hinted at further gains tonight. China's Shanghai Composite rose 0.4%, Hong Kong's Hang Seng 2.55% and Japan's Nikkei 1.77%. Dow futures were recently 33 points or 0.2% ahead.

Crude oil futures improved 63 cents or 1.3% this morning to US$49.25 a barrel. Gold futures were $1.10 or 0.1% weaker at US$1,231.10 an ounce. The dollar was buying 71.91 US cents.


Explosive rally overnight. Came out of the blue and was likely exaggerated by short-sellers scrambling to cover. Unclear yet if it has any greater meaning. Has pushed the XJO back up to the top of the recent trading channel faster than I expected. Next few sessions look likely to be meaningful in terms of the medium-term direction. Back home, it's starting to look like it's safer to be out of the horde of lithium explorers before results are reported. There will be exceptions, but so far the market much prefers blue sky to dour reality. Trading: a defensive session, which is another way of saying every trade I opened moved against me before it came good. CXO, SAR and IVR were the trades.