redback report week ended 11/2/2011, page-6

Hi Red,

I can understand why you're adding to longs. But the market just looks ready for a rest. Not necessarily anything drastic.

Here's a chart I drew up for Westpac - it looks overextended in the short term.



Dow Industrials with an RSI at 78 - that just looks crazy to me. An accident waiting to happen.

Whether that will be a broken leg or a scraped shin - time will tell.

I keep a private diary of eight stocks for trading and writing options. Four of those look to me likely buys: WPL, AMC, SUN, WOW. But I'd like to see some upwards movement before stepping in.

Best of luck with the longs.

Redbacka