Hi DG, thanks for compliment on the forks. Afterall, I learnt most of it from you and your references mate! You raise a good point, "do we have accumulation or redistribution?". My take on that, after a long fall in SP from $24-49 on 29th April to now, in VSA principles;
23rd May - high volume down bar closing close to low @ $22.02; 24th May - high volume down bar closing towards the bottom @ $21-80; 25th May - high volume bar (Dragonfly Doji) open and close the same, big tail @ $21-70; 11th June - they have another crack driving it down on high volume to close @ $21-35;
SP then meanders along, tries to go up on no lesser volume and rolls over to where we find it today, a doji on below average volume to close @ $21-78, nudging the 50% of median fork line.
On face value, it appears to be in accumulation phase? and be interested in your views (or any others) from VSA perspective. From a technical perspective, the banks generally, are oversold in my opinion. Apart from working in the industry as you know, they are all suffering from the global financial pressures. Yet, we are largely, insulated from that, with some of the most sound banks in the world here in OZ. The banks are becoming sound yield plays now and I really dont expect them to keep going much further. If I am correct (trust me, I may not be!) with the level of accumulation going on, the SM wouldnt want to let it SP slip much further, given where they could be averaged at. I just get a sense that the banks have significant liquidity and takes a while to mop it up. I am OK with the banks and happy to hold as necessary. I have needed to do it on a number of occassions and always get out ok...just timing.
Anyhow, just my thoughts mate and no issues around the shorting side of things. As you know, I am considering doing the same soon, but need to exit this trade first. Have a great weekend mate! Cheers
