The methods I have been discussing and the results displayed have given no consideration to what a company does to make its earnings. Using Technical Analysis (and fundamental analysis at times) as the primary reason for our buy and sell signals gives no consideration to the reasons “why” a share is performing as it is, it is “as it is” so we buy and sell based on momentum of the price and the emotion of the crowd.
However some people are deeply concerned about company’s effect on the environment and the impact the companies policy may make socially. Our trading rules may trigger a buy in a gambling company and you may be passionately opposed to gambling, or you feel strongly opposed to alcohol and consider it a social problem and do not want to support companies in this sector, in this case you will need to do your own screening of stocks to suit your personal beliefs.
For example for many years I have specialized in the gold market, particularly gold shares. I believe Governments throughout the world create financial instability via central banks by the printing of paper money. With no backing of a physical asset like gold that can not be manipulated, they over stimulate economies creating booms and busts adding to the hardships of many and complicating an already intricate world.
The ownership of gold I see as a positive for global stability and I support the industry selectively.
Mining is a controversial issue and I agree with the concerns of many, recently one of the worlds biggest gold miners, Newcrest Mining of Australia has taken over Lihir gold of Papua New Guinea. Lihir has a horrid environmental record in that country in regard to polluting river systems and for that reason I would not buy it. Hopefully Newcrest will do a better job.
I remember as a child playing and swimming with children in that country where I lived a short while, I don’t like the thought of that no longer being able to happen because we in the western economies support a company with little concern for social liberties.
This is my choice, and we all need to make our decisions and live with them, it is possible to still make money and trade well by being a little selective.
Below is a guideline as to what to look for before deciding to invest in a company, more information can be found on the ASX website or by googling a companies website
The signals below are so you can follow trades that make NEW 52 week highs for the 52 week high system.
A new 52 week high for this system is classified when the stock price is at its highest close (or equal to the highest close) counting back 52 weeks.
If a stock continues to make new highs, for example in the 53rd and 54th week, they are now regarded as ROLLING highs, not NEW 52 week highs.To clarify again, the buy signal for THIS system discussed is a NEW 52nd week or 1 year closing high, not a rolling high as is often given elsewhere.
The signals provided are WITHOUT A BULL FILTER.
The exit used FOR THIS METHOD is the 7/12 EMA crossover. Therefore, some stocks will be re signalling a new high buy signal if they have been recently exited by using the 7/12 exit within the last 12 months. This is important and you need to understand this.
Of course the 7 EMA needs to be above the 12 EMA to make the 52 week high valid, (otherwise we would be selling straight away) nearly always this is the case, but rarely if a stock spikes it is not.
So to repeat, the rules are: USING WEEKLY PARAMETERS!
Share price to make a 52 closing (or equal to) week high (when selecting a buy, favour the cheapest stock)
The 7 ema to be above the 12ema
if the 7 ema crosses below the 12 ema
The above system contains no position sizing, bull or bear filters or fundamental stock selection, these are discussed and taught to private clients or at my courses.
Remember these scans are not using a Bull filter. The signals are for the simple 52 week CLOSING high entry and 7/12 EMA crossover exit system only.
STOCKS IN THE ASX 200
None this week
STOCKS IN THE ASX 200-300
NONE THIS WEEK
STOCKS IN THE 300 TO 500
AEF SLK (check announcements for the reason in sudden price jump)
E Book signals:
This week I am again listing the eBook buy signals. The reason they can be different to the signals above is to do with the Bull filter. The following stocks may have made a 52 week closing high a few weeks ago but were not valid buys in the eBook system because the Bull filter eliminated them, so sometimes the eBook signals are delayed compared to the simple 52 week high system not using the Bull filter. Sometimes the signals with or without the bull filter are the same, it depends on what the market has been doing. The signals below are either valid or not depending on the Bull Filter. If there are no signals below it will be for of one of two reasons. 1/ there are no signals for the eBook system this week, or 2/ the bull filter is not active.
The eBook signals for the ASX 300 on 11/10/19
NONE THIS WEEK
As you can see from the chart of the eBook system below, all trades had been stopped by Dec 2018, if you had of started the system in Dec 17. If you started the system earlier or later than this start date, you may still have a few trades open in your portfolio. (because you would be holding different stocks than in the portfolio chart below) The correction in Dec 2018 was a significant time in the performance of the system as it went totally to cash but then re signaled to buy again in late to mid January 2019. (NOTE THE SPIKE IN CASH HELD IN DARK GREEN SHOWING ALL STOCKS GONE TO CASH IN JAN 19)
This week ending 11/10/19 the system rose 1.5%.
Equity total is now 157.8K. 57.8% return in 21 months (not including dividends but also not including brokerage) Income from dividends would be far more than brokerage outgoings.
No trades this week
What is very important to remember is that the example below is just one of many possible portfolios, depending on the size of a persons portfolio and when they started. So, another traders portfolio will have a different makeup, and be buying and selling different stocks, even though they are using the same rules as others.
I will post trades held later on the weekend. There has been no change to the holdings fom last week.
This chart below shows two volume indicators, the On Balance Volume and the Chaiken Money Flow (displayed in green) using a 13 week format.
MARKET COMMENTS: As of 11/10/19: See chart below
Last week I said this. "Personally I think the markets need a period of consolidation before the long term uptrend continues". This weeks bounce up on low volume may be confirming that thought, typical price action for a sideways period is up and down movement on low volume, which can mean "no conviction" from Bulls or Bears. That does not mean to say stocks won't trend because strong ones will continue to do so, like PNV this week. The bull filter is active , if you are wondering, but we have no signals so it's shut down the computer and come back next week. Easy share trading. Peters Portfolio rose nearly 2% this week.
MARKET COMMENTS: As of 4/10/19: See chart below
Ha! So the CMF warning had some merit after all. The market falling, from concerns of global growth. The market climbs a wall of worry and how valid that worry is only time has the answer. Looking at the chart above volumes still look solid, they are trending up, and price is trending up too but the XAO has closed below the bull filter so we stand aside for the time being. We watch with interest and without judgement, helping our minds to remain calm. You have a system or method (hopefully) so focus on sticking to it, not predicting or getting caught up in too much analysing. Personally I think the markets need a period of consolidation before the long term uptrend continues. I have posted a long term monthly chart below, the trend looks impressive and volumes judged by the CMF even better. Peters Portfolio rose a little this week, bucking the markets downtrend. After 2 years of trading the portfolio is up 62% compared to the All Ords up 12.7%.
MARKET COMMENTS: As of 27/9/19: See chart below
Now it is getting interesting. The 13 week period CMF breaks the trend line to the upside negating the negative divergence I mentioned last week. OBV is still positive. Price holds. The trades in the eBook system this week are a perfect example of why I adopt the Zen philosophy of "Don't Know" and use probability NOT prediction. If you panicked and sold out last week because of the divergence in volume, you would be full of regret. If you are regretting something, let it go, move on to the next trade and put it down to lesson learned. Peter's Portfolio fell a little this week, around one third of a percent, so I am leaving the equity curve on that site page unchanged. Quite a few changes in my holdings this week as I re weight the portfolio.
MARKET COMMENTS: As of 20/9/19: See chart below
A similar looking chart to last week. The price rises, OBV indicator confirms, but the CMF lags. That is a serious looking divergence between price and volume, but it is only ONE indicator. I could find another indicator to support the big volume bar of this week, shown in the volume column graph. This is an interesting little discussion, because it is what most traders do, look, analyze, worry and get confused. So it would be wise to fall back on what we know, and what we know is this: The market is trending up, Bull filter is active, alerts are generated to buy or sell. It's all a process and it can be a simple process if only we allow it to be. Peters Portfolio had a stellar week rising nearly 5 %, helped along mainly by ALK.
MARKET COMMENTS: As of 13/9/19: See chart below
MARKET COMMENTS: As of 13/9/19: See chart below
This week the XAO continues its rise. The banks were the main drivers, and the resource heavyweights helped too, so the XAO looks good. However the mid cap sector fell, and Peters portfolio had a flat week, as it is mainly invested in mid caps. The chart above shows the OBV breaking the trendline but the CMF, using a 13 week period, is yet to confirm. As always, let us not read too much into this chart, the main thing is the bull filter is active and the market is trending up.
MARKET COMMENTS: As of 6/9/19: See chart below
The XAO continues the recovery from the recent sell down. Volume indicators are approaching resistance points but we won't read too much into that because as always, the price is the main indicator. So, it is up, the bull filter is active, so we follow the process. Peters Portfolio rose around 1% and will be posted later this weekend or on Monday. There were no changes to it from last week. Have a good week. Peter.
MARKET COMMENTS: As of 30/8/19: See chart below
The Bull filter is active. Volumes are testing the upper levels of their trend lines. I think I said enough in last weeks market comments, and with the news letter this week.
"If it is not necessary to say anything, it is necessary to say nothing". A Zen saying.
"Stick to the system". A Peter Castle saying.
I wrote the above on Friday night, (it is now Sat morning) after some reflection I thought an explanation may be needed. The Zen saying refers to not falling into the trap of meddling, or thinking you need to meddle, when there is no need. As traders the greatest challenge is to stay removed from the crowd when negativity abounds. Often we feel we need to do something but often the best response is to do nothing. Or "sit on your hands" as some of the famous traders of the past have expressed.
As to the Peter Castle saying. I will repeat my teaching mantra. The two reasons why traders struggle to make money from the market is:
1/ they don't have a system or method
2/ if they do have a system or method they don't stick to it.
Your trading success or failure will revolve around one or both of those points.
Peters Portfolio will be updated on Saturday afternoon, I have not done the final calculations but it had another good week rising around 4%.
MARKET COMMENTS: As of 23/8/19: (see 3 charts below)
The XAO, dominated by the top 20 stocks, recovered a little this week. Volume indicators look weak, with the trend lines remaining broken to the downside. The bull filter for the eBook system is inactive. So our strategy is to stand aside and hold our nerve while the shakeout continues, which seems certain to happen as I know the US market had a fall on Friday so know doubt we will follow. The easy share trading systems had a good week, the eBook system rose 2.5 % and Peters Portfolio over 6% on the back of some good company reports, the Castle Fundamental Criteria doing its job well. It seems to be more of a stock pickers market at the moment, as the general euphoria of the recovery from Dec 18 slows, and fears become more intense. There are another 2 charts below with more comments.......
Last week I mentioned the longer term price trend line, I have drawn that 3 year line on the chart above, as well as a shorter term 2 year trend line on the influential OBV indicator. Now, this is important....if that OBV trend line breaks down it would indicate the probability of this Index to keep falling. It has already fallen to the first horizontal support line and could fall to the second one near 6200. Horizontal support lines are not as strong as sloping up trend lines, but the next sloping trend line of significance is at 5700 which is a long way from where we are now. One more chart below.........
The chart above is of the US SP500, arguably the most influential chart in the world. Looking at the OBV indicator in the short term, ( a few months) it looks like more falls will come. A revisit of the lows in May would not surprise me, considering we are now in the bearish seasonal period of May to October. However. Looking at the OBV trendline starting around April 18, it still looks quite supportive. I know that some market commentators are advising clients to sell up completely or go to significant levels of cash. I think it's a bit early to make that call as the charts above do not look that bad, as yet. Good traders work with the information we have in the present moment, and good traders do not allow the noise around us to govern our decisions. It will be an interesting week, stay calm. All the best, Peter.
MARKET COMMENTS: As of 16/8/19: (see charts below)
The XAO keeps falling towards the 6400 mark, where I have drawn the blue horizontal support line. Volume indicators confirm the sell off. Horizontal support lines are not as strong as trend lines and the next trend line of significance is at 5900. (not drawn on chart) It is far too early to suggest the market will fall to that level but the chart above does look like more falls could easily happen. Support between 6200 and 6400 is my guess at the moment. The eBook systems trades posted above are hanging in there well, with no stops signalled this week. Peters Portfolio bucked the market trend and rose a litttle, an indication of the benefit of selecting stocks with good fundamentals. The Castle fundamental rules are taught to clients only and not discussed on this website. Although of course you do get to see what I am buying and selling. There were three sells and one buy this week in my portfolio and a slight raising of cash.
MARKET COMMENTS: As of 9/8/19: (see charts below)
The XAO has fallen below the bull filter so there will be no more buying until it recovers. The OBV trend line has been penetrated to the downside but the CMF remains positive. The market has had a great recovery since the sell off late last year, when markets are high traders and investors get nervous and keep their fingers on the sell trigger. Donald Trumps comments through the week did the rest. It is too early to make a call about the market. This pullback is nothing in the big picture. All markets need to pause a while to decide which way they go next, to continue up, go sideways or sell. The market could fall to around 6400 and still be in a strong bull market so dont be surprised if we have some more volatility over the next few weeks or months. From a seasonal perspective the market often falls into Sept/Oct before it rallies into Christmas.
MARKET COMMENTS: As of 2/8/19: (see charts below)
The On Balance Volume is a slow indicator, but it normally gets it right, if divergence occurs between price and volume, they converge back. The OBV has not been confirming the recent rally of the XAO, it was heading down as price went up. However it need not be a big concern bearing in mind the XAO is dominated by big resource companies and the banks. The eBook system bucked the down trend, rising this week, helped by big rallies in NCM and TCL. Looking at the charts of the XAO and the volume, it does look as if a pullback is under way. How deep this will be is anyones guess, it may not affect stocks in the portfolios as the systems tend to steer away from the banks and big miners. Peters Portfolio fell a little this week, it has one more day to trade when I post it on Monday night. No new trades on either system, although NEA is showing a sell and will be let go next week.
MARKET COMMENTS: As of 26/7/19: (see charts below)
The market rises again. The unseasonal performance continues. The CMF volume indicator is strong but the slower moving OBV is not confirming. However price is the ultimate indicator and we follow the price. The Bull filter is in full flight but most portfolios of mine and those of clients are not buying because they don't have any money to do so. With few stocks being stopped out it's just a matter of holding on for the ride. It looks like at the end of this month the market will make an all time closing high. We will find out on Wednesdays market close.
MARKET COMMENTS: As of 19/7/19: (see charts below)
Despite the strong close on Friday, and the CMF volume indicator breaking the short term trend to the upside, the OBV is reluctant to be positive. Never forget that this index reflects mainly the banks and resources, other stocks can be performing well despite what this index does. However this index is so widely watched that it does affect the mood of the market.
The eBook system stalled a little last week but Peters Portfolio had a good week, I will post the portfolio either Monday night or sometime Tuesday. A reminder that the eBook system trades only the ASX300 and Peters Portfolio trades a stock list created from the Castle Fundamental rules. Some of these stocks may be in the ASX300 and some may not. Stocks that are outside the ASX300 but meet the Castle Fundamental criteria are included in the list of stocks I trade. This list is made available to clients and students.
MARKET COMMENTS: As of 12/7/19: (see charts below)
Not much to say this week. The market paused a little, perhaps respecting the indecision about volume and price, which I mentioned last week. It didnt stop the eBook system though, up another 1.3 % as strong stocks continue to trend up. Peters Portfolio pulled back a little, it holds different stocks to the eBook system. I will post the portfolio early next week, there were a few stocks sold and bought. Remember if you can to detach emotionally from what sells and buys, it's just a process of buying strength and selling weakness. Think like a football coach on the sideline, replacing weak or tired players with fresh stronger ones.
MARKET COMMENTS: As of 5/7/19: (see charts below)
The market rallies again but on low volume. The OBV (the black volume indicator) is not confirming the rally, note the flat lining of the trend line on that indicator where I have drawn a short blue line. However the shorter term volume indicator (the green CMF) is looking like a breakout. So as is often the case with indicators they can conflict and confuse. What to do? Price is the ultimate indicator. The price is up so we hold our positions. We reflect on our methodology and some of the time proven advice.
"Let winners run".
"The trend is your friend until it bends at the end".
and my favourite Zen saying
"If it is not necessary to do anything it is necessary to do nothing"
I have a very important chart for you to consider, in a week or so I will write a news letter about it. Those of you that follow my work will need no explanation. I will give you a clue, look what happened the last time the XAO made a new all time high. Now think about how the banks and resource stocks have been performing lately.
MARKET COMMENTS: As of 28/6/19: (see charts below)
Some caution this week as the market took a breath. The trend is up and volumes are good. Despite seasonal factors being against the market (Sell in May and go away tradition) and the sabre rattling from the US and Iran, the market continues to defy the bears and continue up. This weekend marks the end of the Australian financial year, the end of the 2nd quarter in the US (globally too) and the end of the month. I would expect some re-arranging of portfolios next week as traders and investors attempt to position themselves to be in the best stocks and sectors. We don't care what they do, we have a system that is working well so why change it? See you next week and stay calm, stick to your chosen method.
MARKET COMMENTS: As of 21/6/19: (see charts below)
Well the eBook system continues to surprise even me! I knew it was a good system but boy its flying, up 5.6 % this week and outperfroming Peters Portfolio, maybe it's time for me to swap back to it :) It was helped along a lot this week by the gold stocks, goes to show you should just follow the signals as they come, the system will put you into the strongest stocks. The chart above of the XAO pulled back a little on Friday. My guess is because it is flirting with the old market high back in 2007 and the T.A. traders kicked in and sold the resistance point. There is now a divergence between price and volume, the CMF line is pointing down and the price up. But the OBV remains strong so its hard to say what it means. The price is well above the Bull filter line so one would "expect" a pull back or slow down, but I will repeat again what I said the last 2 weeks
" I think this market will surprise to the upside and there is a chance we will see a parabolic move up as we did during the tech boom of the late 1990's and the lead up to the GFC in 2006 and 2007. Lets hope we dont get the same ending. Its very interesting times and a great time to be in the market."
I also suggest you have a look at the property chart I posted in late May, scroll down to see it, the level is now 1643 up 2% from 1610.
MARKET COMMENTS: As of 14/6/19: (see charts below)
" I think this market will surprise to the upside and there is a chance we will see a parabolic move up as we did during the tech boom of the late 1990's and the lead up to the GFC in 2006 and 2007. Lets hope we dont get the same ending. Its very interesting times and a great time to be in the market."
Thats what I wrote last week and this weeks price action indicates the probability of that statement has merit. No predictions here.........but this market is STRONG. Some consolidation now would not surprise me, but I wouldn't count on it. Trade your signals and stick to your method. The ride may get fast and volatile so stay calm, dont screen watch and if you don't already do so, adopt some calming modalities like meditation, walking, exercise, writing....whatever grounds your thinking.
MARKET COMMENTS: As of 7/6/19: (see charts below)
A rebound in prices this week as the bull market continues. I think this market will surprise to the upside and there is a chance we will see a parabolic move up as we did during the tech boom of the late 1990's and the lead up to the GFC in 2006 and 2007. Lets hope we dont get the same ending. Its very interesting times and a great time to be in the market.
MARKET COMMENTS: As of 31/5/19: (see charts below)
Last week I mentioned the CMF was pointing down indicating volume was not aligned with price action. The CMF continued to fall and the price of the XAO fell, affected by some of the bigger stocks giving back some after the post election rally. However it didn't bother the eBook system as it rose 1.4% bucking the trend. Why? The eBook system, because of the 52 week closing high, only buys stocks trending up. Sector analysis looks after itself as weak sectors tend not to trigger 52 week highs. The chart above still looks ok, the OBV (slower moving volume indicator) is still trending up. In the U.S. the influential SP500 continues to pull back from its double top but until we get any sell signals, which we are not, then it's STICK TO THE SYSTEM. If you are having trouble sticking to your method either your method does not suit you or you have some mindset issues to investigate. Email me or give me a call, first consult is free.
MARKET COMMENTS: As of 24/5/19: (see charts below)
The XAO rose again this week as the Banks and Property sector went bananas after the LNP win. There are 2 volume indicators on the chart above, the OBV and the faster moving CMF. The CMF is showing a divergence to the price action. Now this could be a short term thing but it's worth watching cosidering the sudden jump in the dominant financial sector. Those of you that attended my seminars in Febuary and again last Sunday will remember the chart below. With the recent election, possible rate cuts, the property taxes off the table and the banks freeing up more money (apparently) the property market may be in for an upswing, the cycle certainly suggests it.
MARKET COMMENTS: As of 17/5/19: (see charts below)
The market rallies from the short term sell off with good volume backing the move. The eBook system and Peters Portfolio put on nearly 4% each. A good week to be a trend trader. I will save any more comments for this Sunday at the seminar in Sydney. I am looking forward to meeting everyone and discussing this dynamic market we have at the moment.
MARKET COMMENTS: As of 10/5/19: (see charts below)
The markets threw us a curve ball this week with Trumps tweets. However the double top has many nervous and it was an excuse to sell. The faster moving 13 period CMF warned a few weeks ago volume was receding, but the OBV looks supportive. The bull filter is still well in play. The eBook system churns a few stocks this week as it follows its process, sell weak stocks buy stronger ones. Simple is it not?
MARKET COMMENTS: As of 3/5/19: (see charts below)
Big volume this week, it was a full weeks trading compared to last week and also the end of the month. The eBook rose again this week despite the index falling a little. I notice in the US on Friday night the Russel 2000 broke up out of consolidation. To me this indicates more rises to come particularly in the mid and small cap shares. Interesting times.
MARKET COMMENTS: As of 26/4/19: (see charts below)
Price crashes past the old highs in August 18, on the way to the all time high of 6873 set way back in 2007. When markets are running like this they confound most market analysts, the reason why the great trend trader Ed Seykota quipped many years ago "The trend is your friend until it bends at the end". I assure you this trend will bend sooner or later but until then we let the market decide when to sell, and the plan is to hold our positions and be grateful.
MARKET COMMENTS: As of 18/4/19: (see charts below)
The Market rose again this week but volume is dropping and I notice some volatility in the smaller stocks and mid caps. After bagging the Gorilla stocks last week, this week they did well!......holding up the index. Traders and investors must be getting nervous as the index approaches the old highs in August 18. Many "expect" a sell off, it would seem probable, a pull back of some kind, however this market is strong and the US indicies continue to rise. The eBook system pulled back a little this week as its stocks has had a great run, so it took a breather. Volume is trending down signifying buyers could be drying up, for a while anyway, but really who knows with this market. Stay calm and stick to YOUR method.
MARKET COMMENTS: As of 12/4/19: (see charts below)
The market rises again this week. The eBook system had a great week rising nearly 5%. That's a lot and it surprises even me. Peters Portfolio in comparison notched up a measly 2.5% but it does not include this coming Mondays trading. As you can see the XAO didnt rise that much so why the big gains? Because big gains are not in Gorilla stocks like banks, the gains are in low priced stocks with growth prospects, exactly what the eBook system targets by buying 52 week highs. Peters Portfolio does a similar thing but is a little more conservative. Look at the chart below, the XNJ is the industrials sector. Along with this sector and others like Health and Technology, these sectors are driving the market, not banks and not many of the Gorilla mum and dad stocks of old.
MARKET COMMENTS: As of 5/4/19: (see charts below)
This weeks price action is arguably more negative than last weeks, however it was on small volume indicating sellers are not dominating. Volumes indicators are conflicting, the faster moving 13 period CMF is looking negative but the slower moving OBV is holding up. I was reminding myself this morning uptrends can last a lot longer than thought and surprise many, The US market continues to rise and we will follow despite the "expected" fall that may come here in the Aussie market. As hard as it is psychologically the best thing to do is stick to your system/method. Remember too the XAO is dominated by the financial sector, I encourage you to look at sectors like resources, health and particularly technology, where you will see more strength than what is displayed above. However investors mindset is often influenced by the overall market, the reason I display this chart with comments.
MARKET COMMENTS: As of 29/3/19: (see charts below)
It was the most bearish week we have had since the recovery. The market fell below the lows of the last 3 bars, but it closed up quite strongly towards the end of the week. There is no warning sign yet from the volume indicators, one weeks price action does not make a downturn. At the moment (and that is all we have the present moment) the market is taking a breath. It's good to see because the more this market rallied up hard the greater the chance of a sell off to compensate. Trend traders hold your nerve.
MARKET COMMENTS: As of 22/3/19: (see charts below)
Another good week for the systems. The eBook rose around 1% and so did Peters Portfolio which will be posted on Mondays close. It's looking like a classic V shaped recovery on the chart above. I spoke to a few trading clients this week that have been doing very well the last few years, why? They stuck to their system. My mantra remains the same, the two reasons traders fail is they don't have a method, if they do have one they don't stick to it. The technical side of trading is easy, the mental side is hard, thats why you need a method that suits YOU, your objectives and personality. Developing that system for you is my job. Good luck next week.
MARKET COMMENTS: As of 15/3/19: (see charts below)
Everyone is waiting for a pullback but we may not get one until this market reaches the highs set in August 2018. Then we still may not get a pullback.........its why I always say prediction is so difficult. Remember always that this index is often governed by the dominant stocks of finance and resources, mid cap stocks can power along without really affecting the look of the XAO. The index fell a little this week but the eBook stocks continued to rise, as did Peters Potfolio which will be published after Mondays close. This market continues to look strong, volume indicators are not weakening and there were a good number of new 52 week closing highs this week. Last week there were only a few, suggesting things were slowing but this week shows strength again with more new signals. TLS being a notable signal.
MARKET COMMENTS: As of 8/3/19: (see charts below)
Is the market finally taking a pause? Not a lot of change this week. The OBV continues up but the CMF points a little down, price is flat. Next week will be interesting. Both the eBook system and Peters Portfolio had a good week rising 1.5%.
MARKET COMMENTS: As of 1/3/19: (see charts below)
What a difference a week can make. I often say PRICE is the ultimate indicator. Even though the volumes were looking a little weak last week, price has continued up, with now a lot of volume supporting the upmove. In fact price now is chasing volume, both the OBV and the CMF suggesting the price will go higher as they outpace the price. We know in the US on Friday the market had a rally so we would "expect" (nothing is certain) the XAO to rise as well on Monday. The US 500 is hitting resistance. It needs to break through 3 old highs to continue on and looks over bought on the daily charts. (see chart of US 500 below) The weekly chart looks stronger. (not displayed)
I have made a change to when I publish Peters Portfolio. It will now be published Monday nights to show the stocks bought and sold on that day as the majority of my buying and selling is done on a Monday. Thank you to those that logged in on Thursday night to the webinar. I may have missed some of your questions whilst I focused on the presentation. If so feel free to email me if you have any questions about the content discussed.
MARKET COMMENTS: As of 22/2/19: (see charts below)
As most people following technical analysis will say, the market looks over bought. Many signals are flashing warning, perhaps not so much for a fall but a slow down at least. The confusing thing is that I have agressive momentum systems that are signalling to buy the market. The chart above shows a negative divergence on the CMF between price and volume, this does not mean to say the index will fall or crash, but it is an indication (and that's all indicators are, indications) that perhaps the bulls are becoming less commited after the recent big rally. It makes sense as markets do not rise in a straight line forever, but this market is strong and could go on to meet the highs made back in August 18 sooner than later. So what to do? As usual it comes down to following the method you have selected to suit your mindset and objectives. (if you don't have a method get one) The eBook system has had a stellar run since entering the market again 6 weeks ago, putting on almost 9% from its cash out lows. Going into March portfolios will now be supported with coming dividend payments. Will the index of the XAO looking overbought slow the strong trending stocks? I am not sure it will but time will tell.
MARKET COMMENTS: As of 15/2/19: (see charts below)
The index takes a breath. But its a misleading chart because its dominated by the financials which fell this week. Many stocks continue to rocket as is indicated by the rally in the eBook system this week as well as the good performance of Peters Portfolio, the small and mid cap system . For example look at the chart below of the materials sector, a sector without the financials. A much stronger looking chart and the volume indicators confirming the upmove. However we dont need to do sector analysis too much, the 52 week highs will tell us where the strength is. That's why you havn't seen a 52 week high in many banks because they lack strength. Trend trading is about buying strength and selling weakness. Simple.
MARKET COMMENTS: As of 8/2/19: (see charts below)
Well. It goes to show you should follow the trend. A big week and those that had the courage to buy a few weeks ago when the signals came are being rewarded. The OBV has kicked up but the CMF lags a little, a big volume bar though supports the bullish move up. I notice many comapnies are reporting strong results indicating the long term bull market has perhaps legs yet. Its been quite a recovery from the lows only 7 weeks ago indicating how oversold the market was. For many traders they will be feeling confused and frustrated as the fear of loss is replaced with the fear of missing out. If thats one of you I suggest you work on getting a good method...........and sticking to it.
MARKET COMMENTS: As of 1/2/19: (see charts below)
This week volume is up but price slightly down. To me (and each persons view is subjective) the chart above shows uncertainty and reserve. The US SP500 has now reached the 61.8 Fibonacci level of around 2700 points surpassing the 50% point. I have never been a fan of Fibonacci however many traders put great store in it perhaps making it a self fulfilling prophecy. The markets have had a strong rally off its lows, a pause, consolidation or drop back is due. However if this does happen, and it might not, this may not stop the strong trending stocks from still out performing, which of course is the whole idea of trend trading as we hopefully position ourselves in only those stocks that are rising.....and have a good probability of continuing to do so.
MARKET COMMENTS: As of 25/1/19: (see charts below)
The recovery on the Aussie market continues. The US market did have a pause this week(but I write this with one more trading day to go in the U.S. for this week). Volume on the XAO has picked up, as can be seen by the volume bar plus the CMF has now broken its down trend line to the upside. However the OBV is not confirming the rally, still flatlining despite the price rising. Its not a big concern but an indication that buyesr are still cautious not convinced this is a recovery but a bear market rally. The eBook system will be all in next week, my own portfolio is flatlining as I wait for my systems mid cap bull filter to kick in, as it has not done so. The recovery is more in the top 300 so far. I have taken the time out to do some more testing and developing on monthly systems, and prepare for the Feb lecture at the ATAA in Sydney.
MARKET COMMENTS: As of 18/1/19: (see charts below)
The XAO has another rally this week on lowish volume. Investors are cautiously buying back in although some stocks are rocketing as can be seen by looking at the charts of the 52 week high signals above. Looking at the US market (chart below of the SP500) one would think a pause would happen soon now that it has pulled back up over 50% from the low to the high. The problem is that's a subjective statement and no one knows what will happen.....however we do have probability to work with which is the best tool. The challenge with trading is following your system, experienced traders know that. So is this a recovery in a bull market or a bear market rally? I think it's the former and time will tell.
MARKET COMMENTS: As of 11/1/19: (see charts below)
Ok. The rally I suggested last week has come and the eBook filter is in buy mode. I posted some extra comments about the eBook above this XAO chart, I suggest you read it if you have not done so. Volume is low this week. I am not sure if this is because some investors/traders are still in holiday mode or if there is another reason. OBV has broken a short term trendline to the upside but I wouldnt get too excited about that. The CMF looks postive but yet to break its downtrend line. Despite what we read into the chart above (and we will all see something different) the fact is the eBook system is saying buy. If you are following this method its challenging emotionally to buy after the pullback of the last few months. However if you have chosen to trade a mechanical system, its part of the commitment.
My system in Peters Portfolio trades a slower Bull filter. It has not yet given a signal to buy. Now...this is not because my system is "better" than the eBook. It's because I have been trading that filter for many years and I do not want to change it. Regular readers will know my philosophy of pick a system and stick to it!
MARKET COMMENTS: As of 4/1/19: (see charts below)
Post holiday trading returns to normal next week, the past 2 weeks have been reduced volume so price action could be regarded as less telling. A good week could put the XAO back in buy mode if it can cross above the eBook Bull filter moving average marked in red. The filter has kept many from buying for 14 weeks now, as the market goes through its correction. I seem to be the only one not calling this a bear market. Until long term trendlines are broken to the downside I still see this as a correction. Looking at a daily chart of the US market (posted below) I notice it has made a short term technical breakout to the upside, next week will be interesting, a big rally would not surprise me.
MARKET COMMENTS: As of 28/12/18: (see charts below)
The XAO fell to the 5500 area I had been talking about for weeks, in fact it hit 5478 as the low. Very low volumes because of the holiday break (only 3 days trading) but price action is significant. US markets bounced off long term monthly trend lines I talked about in my last newsletter. Click on the link below if you missed it. This may be the start of consolidation before the next rise, or it could be a pause in the falling. Its wait and see and let the market tell us what the future holds.
MARKET COMMENTS: As of 21/12/18: (see charts below)
The XAO has reached the 5500 level I have been talking about for some time, US markets are on long term support lines too like our local market is. This market looks oversold to me, volumes still look supportive long term as shown by the trendline of the OBV. It has come back to the breakout area it had a few years ago. The breakout that started the euphoric stage that is now correcting. Try and remember (always) that markets are driven by emotion more than fundamentals or technicals. Attempt to detach from your pain and look at whats happening in a removed state of mind. You will see it all so much more clearly.
MARKET COMMENTS: As of 14/12/18: (see charts below)
The above chart was posted after 2 days trading of the week, so I posted in on the 19/12/18 before Wednesdays trading. However not a lot has changed from last week.
The market looks to be seeking the 5500 level particularly with US markets continuing to fall. Last weeks CMF indicator shown in the chart below
has now broken its short term trend line to the downside. Longer term the market looks well, we just have to sit out this correction.
MARKET COMMENTS: As of 7/12/18: (see charts below)
Not a lot has changed this week. Volume indicators have kicked up a little, this "feels" and looks like a bottoming process,
however with the continual falling of the US markets our market wont go anywhere. In fact we may visit 5500 sooner than later.
It might take this to exhaust the sellers. The chart below shows again the US500, its a daily chart so we cant read too much
into it. Fridays reversal of price now makes the chart look like it wants to fall more, despite volume indicators suggesting
support. Its wait and see.
MARKET COMMENTS: As of 30/11/18: (see charts below)
Volume picks up and the price falls a little. OBV verifies what I said last week, buyers are on the sidelines waiting. The 13
week CMF indicator looks stronger, its a slower moving indicator, however it does show good support in the longer term.
It would not surprise me to see the index reach down for the 5500 region, it may only be for a day or two but perhaps we
need to do that to exhaust the sellers. This is a correction, not a bear market. Once sellers are exhausted the
balance of power (emotion) will change to buying and the market will rally. The US market (see chart below) looks stronger
but thats been the trend for years. The Australian markets big 3 sectors, banking, resources and property all underperformed
MARKET COMMENTS: As of 23/11/18: (see charts below)
I have posted 3 charts this week, lets look at the one above first. A concern is the breakdown of the OBV trendline, even
though the 13 period CMF looks much more supportive. Its not a good sign that the OBV has broken down, it often indicates
more falls. Lets look at the 2nd chart.
Below you can see a longer term chart, I have drawn the longer term trend lines on it. There is long term support around
5500, this market could fall to that level before regaining the uptrend. We are not in a bear market, not yet, it would need
to fall below the trendline at 5400 for a bear market to really take hold. Scroll below for the 3rd chart.
I have posted again the US 500. Its a daily chart and you can clearly see the divergence between price and indicators,
although volume is not strong, its not weak either. Daily charts lead the weekly charts, and weekly charts lead the monthly,
so this positive looking daily chart could produce a strong performance next week in the US.
It appears to me there is indecision as if to buy this market or not. Whilst the indecision remains, downside out weighs the
MARKET COMMENTS: As of 16/11/18: (see charts below)
The market reverses this week after two up weeks. The volume indicators are hanging in there. The eBook system buy filter
is keeping traders of that system out of the market, which may prove to be the best strategy. Peters Portfolio continues to cash
up with another stock sold this week. This week I have posted below a chart of the US SP500. It's in a daily format and you
can see last nights trading (their Friday) shows an up bar with volume supporting the rise. The Australian market correlates
closely to this index and if it holds up ours should too.
MARKET COMMENTS: As of 9/11/18: (see charts below)
The market continues to recover from the sell off. I notice now market commentators are saying it was irrational and over
done, I didnt hear that 2 weeks ago! Ignore the news, trade your method. The volume indicators above are suggesting the
index has more to rise next week. Peters Portfolio had another strong recovery week. Two new 52 week highs in ASX 200
this week, a good sign confidence is returning.
MARKET COMMENTS: As of 2/11/18: (see charts below)
Well we got the bounce the volume and price indicators were suggesting. I have gone back to a weekly bar chart, it shows
this weeks price action more clearly than the line chart. I would have liked to have seen a stronger week, but considering
the Aussie market jumped out of the gates before the U.S. did, it was a good week. Peters Portfolio bounced even better,
it has more cash now in reserve, to either sit out further falls or buy into stocks as they trigger. I notice the rhetoric from
some market commentators is already changing, saying that things may be not be as bad as first thought. Ignore all talking
heads and trade your method. No one knows.
MARKET COMMENTS: As of 26/10/18: (see charts below)
So it's been a horrible 2 weeks (if you are long the market, great if you were short) let's look at a longer term chart first to
see if it is as bad as some people are thinking. The monthly chart above shows the long term price of the All Ords still trending
up, with the long term blue trend line still rising.
The two volume indicators the CMF (displayed in green and adjusted to a 3 month period to reflect the monthy scale)
and the OBV (in black) are showing a positive divergence, (price down but volume still holding up) It could verify what I said 2 weeks ago,
sellers seem non commited, now let's look at the weekly chart.
The price of the All Ords has come down to the blue horizontal resistance line. My experience is that horizontal resistance lines are
not as strong as trend lines, so it could fall below that line, but then it has the monthly up trend line to meet, as shown in
the monthly chart above. The CMF has been adjusted back to a 13 period, as it is normally displayed. Both weekly volume indicators reflect
what the monthly chart does, price falling but positive volume dvergence. There are 3 trading days left to the end of the month, to
me the probability of a rally outweighs the probability of more falls, but it's wait and see, we are not in the game of prediction, so the best
thing as always, is stick to YOUR plan.
MARKET COMMENTS: As of 19/10/18: (see charts below)
The XAO has a small bounce this week. Hopefully you have not been stopped out of too many positions. If you have,
they dont deserve to be in your portfolio. I am having server problems, some of you may not have received my newsletter
last week, click on the link from last weeks comments below, to access it.
MARKET COMMENTS: As of 12/10/18: (see charts below)
Tonight I sent a newsletter, you can read it here.
The market has price and volume sitting on support. For those that believe in the Bull market its a great time to buy. Those
volume indicators above on the chart look very strong, this could be the correction we had to have before the next rally.
Peters Portfolio, like everyones got smacked this week, down around 4.5%. However only one stock is giving a sell signal which
is a good sign. I notice Nick Radge put an email out today too, saying his portfolios were down between 8 and 14 %, there is
always someone worse off than yourself! Last week the Bull filter worked a treat, not allowing any buying before the big fall.
MARKET COMMENTS: As of 5/10/18: (see charts below)
The XAO continues to flounder a little. The eBook system filter wanting us to wait. 52 week highs are mainly in the resource stocks,
reflected in the 2nd chart above of the XJR. Those not using a bull filter can buy, those that are wont. It's important to make your
decision about filters and stick to it. Sometimes bull filters make you miss a trade, but they can also save your backside if the market
turns south quickly.
MARKET COMMENTS: As of 28/9/18: (see charts below)
The market recovers slowly. The bull filter is in positive mode. Volumes look to be confirming the trend. Nothing more to
say except follow your method. If you don't have a method, seriously consider getting one. The last 4 weeks were a testing time for some,
particularly those without solid rules. Peter's Portfolio rose a little, around 0.4%, it will be posted on the site in a day or two.
It's up 20.5% in 11 months, which is line with the back testing. It's always heartening to see portfolios perform in line with the testing.
Not all portfolios perform in line with back testing, mainly because of the different start dates. Two traders using the same system will often
get different results, as their portfolios differ. This is a good thing, as if everyone had the same start date, and so the same stocks, they
would be competing for the same buys and sells, limiting opportunity. Whatever system you trade it takes patience and discipline.
Keep good records, execute the process to the best of your ability. Until next week. Peter.
MARKET COMMENTS: As of 21/9/18: (see charts below)
Volumes are back and price rises. The OBV looks very strong, the CMF still a little weak. The eBook system is still waiting to buy,
next week may bring confirmation of what to do, wait more or buy. In the mean time most stocks are holding. No trades this
week for Peters Portfolio and there will be none next week either, which is great, it means stocks are trending and nothing to
do except let the process take care of itself. Stick to the system. Peters Portfolio rose almost 1% this week as the market
MARKET COMMENTS: As of 14/9/18: (see charts below)
The XAO has a quiet week. Volumes are low. The OBV is holding up well and the CMF volume indicator (13 week
period) while looking bad is just confirming what we know. Price and volume have fallen. The bull filter for the eBook
system is still saying step aside and wait. Very few new 52 week highs this week as the market rally takes a breather.
Peters Portfolio had a good week, making a new equity high and rising around 2.5% helped along by some dividends.
MARKET COMMENTS: As of 7/9/18: (see charts below)
The XAO fell this week, below the eBook Bull filter, so its stand aside for those using that method. Volume support remains
with both the OBV and the CMF (13 period) holding up. Looking at the chart above the recent sell off looks like its overdone,
a panic on low volume. However we are not in the game of predicting but responding, so dont second guess the market. As I
always say, trade your method and be as detached as possible. Next week will be interesting. Peters Portfolio held up very well
this week, a main contributor being NST with its merger announcement.
MARKET COMMENTS: As of 31/8/18: (see charts below)
This week its the Mid Caps that rallied. As I said last week the market seems strong across the board. Trade your system.
Stick to the rules, get out of way, and let the market and your method do its thing!
MARKET COMMENTS: As of 24/8/18: (see charts below)
This week was another indication of how the XAO can be a deceiving index as to what's really going on in the market.
I have posted 2 charts this week, the usual XAO and also the Small Ords, which you can see had a big week. There are
19 stocks this week in the top 500 making a new closing 52 week high, thats a lot, indicating the breadth of this market.
Breadth meaning the market is strong across the board, not just the top 10 that dominates the XAO index. Peters Portfolio
had a strong week, a benefit of the fact it is dominated by small and mid caps with good fundamentals.
MARKET COMMENTS: As of 17/8/18: (see chart below)
The index breaks up and out of its 5 week consolidation, read last weeks commennts and also the comments I made going back
a few weeks. The market looks strong again, indicated by a large number of 52 week highs (12 in the top 500) this week.
MARKET COMMENTS: As of 10/8/18: (see chart below)
The All Ords continues to track sideways. This was the 5th week that the index found resistance around the 6400 area.
The OBV indicator is suggesting higher prices, the CMF appears positive too. The strategy is trade your system and be patient.
Higher prices will come, this is a traditional slow time of year before the market often rallies into Xmas.
MARKET COMMENTS: As of 3/8/18: (see chart below)
The market backs off a little this week but its not telling us much. Stick to the system is the best option.
MARKET COMMENTS: As of 27/7/18: (see chart below)
The big picture I mentioned last week dominates. Volume picks up and the market rallies. There is no short term sign of
weakness. The old market highs pre GFC are really not that far away (around 470 points or a little over 7% away).
We could be there by Christmas.
MARKET COMMENTS: As of 20/7/18: (see chart below)
Price continues to push higher but volume is decreasing, the same pattern as the last few weeks. Its wait and see what
happens over the next few weeks. The big picture looks strong, the monthly chart below shows a healthy trend channel
and large volume coming into the market in May and June.
MARKET COMMENTS: As of 13/7/18: (see chart below)
The XAO continues to rise, but there is now a divergence betwen price and volume. Volume is weakening suggesting buyers are
tapped out. Also there is only one new 52 week closing high in the alerts this week, indicating weakness. A pullback or at least consolidation
Peters portfolio managed a small rise this week because some stocks rallied well, but others are falling. Interesting times. I suggested
last week the market was churning, money is being re alloctaed and my portfolio is certainly showing that. One of the good things about
buying 52 week highs is that the strategy normally puts you where the money is going, without having to think about it. It will be
interesting to see what stocks and sectors start to trigger in the coming weeks and months as the churning subsides and decisions are
MARKET COMMENTS: As of 6/7/18: (see chart below)
The XAO goes higher but with less volume. Not all stocks are rising, it seems there is some churning happening. Money being
relocated into other sectors. Peters Portfolio got whacked again this week with the fall in ELD.
MARKET COMMENTS: As of 29/6/18: (see chart below)
Prices and volume recede a little this week, the XAO seems to be getting help from the falling Aussie dollar, as the market
has been resilient to falls on overseas indices. One would expect more consolidation, but it is dangerous to expect or
predict. The trend is strong and up. Peters Portfolio suffered a little this week due to falls in HSN, any stock not perfroming
fundamentally well is punished and MTS and HSN are recent victims.
MARKET COMMENTS: As of 22/6/18: (see chart below)