Tonight is another big day, to see if this second pullback will continue or we reverse from here.
.
Till now the trading patterns has been very good, for the scenario 3 I mentioned that CCJ does a pullback, max 10% or so, and then reverses to make a new 52 week high, and at least goes up to high 60s.
.
So why do I feel the odds of that has increased -
- CCJ has had 4 consecutive red days. Just based on that, odds of a green is very high. It does do 5 reds but very rarely
- Secondly, even though CCJ has had 4 red days, in terms of Closing price, it has only dropped under 4%, from 60.47 to 58.18.
- If CCJ 62.27 was to be the top, the drops would have been higher. Because it would need to get to 20% drop. Average drop per day is only 0.5%.
- ASX U stocks have played very strongly even when we are having pullback. No stock has dropped over 20%. In first pullback many reached there.
- U punters, in this pullback, instead of panicking, having been buying the dips. A strong signal in sentiment that the uptrend is not yet over. At least that's the feeling for now, whether that happens, is to be seen. I had mentioned about buying the dip last week as well, and it has continued.
.
Personally today I bought back all plus that I had let go to play this second pullback (I play a portion for pullbacks). Not sure if it will work, but have gone on gut feel and liking the pattern, for now.
.
So what may happen tomorrow? Much depends on what happens tonight in US. General markets may be red, but may be not a big one. If CCJ is to get its 5th consecutive red, if it can be under 1%, more towards 0.5%, that will still be very positive, setting it up for following day. What we don't want a big drop, like around 3/4%, even over 2% from here will raise question marks. But odds of green is good. If we get a big one, very likely second pullback of this uptrend may be over. Will that happen? Lets hope so. All the best.
(20min delay)