thumb iStock 000002287986XSmallThe 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

Ethical Criteria 

  1. Environment:Avoids companies related to pollution and environmental degradation. Positive screens for pollution reduction and environmental remediation and preservation.
  2. Human Rights:Avoid companies with human rights issues.
  3. Workplace:Positive screen for employment standards.
  4. Arms:Negative screen for militarism and armaments.
  5. Social Health:Negative screen for social justice and positive screen for community development.
  6. Aboriginal:Avoid companies with human rights issues
  7. Corporate Citizen:Negative screen for product and advertising integrity and financial speculation.

Your trading needs to be easy, simple and as stress free as possible.      

Reduce the stress, feel in control and you will trade well.       

Trade well and you make money.

Follow the three sections of this site to learn more

  • Have an Objective
  • Its about YOU
  • Keep it Simple

MARKET COMMENTS: As of 18/9/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI  is displayed in green.

XAO 18th sept 20

One week does not make a trend but weakness prevails as the index stuggles this week and finishes on the downside. Volume is up, for every seller there is a buyer so its interesting that volume is up. Does it mean the smart money is selling or buying?. The bull filter is negative so the strategy for the above method is stand aside.

This coming Monday night (21st Sept)  I am doing a presentation online for the Sydney ATAA. If you are not a member you can get free access if you follow the intructions below.

Normally a visitor pays $15 to attend. 
 
For anyone interested in attending Karen Wong from the Sydney chapter is offering a free visit using the code 
 
SYD1STVISIT
 
Simply enter the code on registration after following the instructions in the link below.
 


52 Week closing highs:

The signals below are so you can follow trades that make NEW 52 week highs for the 52 week high system.

 

52 week closing highs

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!

Entry:

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

Exit:

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.

 

These are the 52 week closing highs (without a bull filter) for the week ending 18/9/20:

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.

 ASX 200

 None this week

 ASX 200 TO 300

 SLK WGX

 ASX 300 to 500

 None this week

52 WEEK HIGHS FOR THE E Book system: (That does use a Bull filter) If you are confused about the use of filters, I suggest you read well the comments about that above. 

 

   None: The bull filter is negative

 

 MARKET COMMENTS: As of 11/9/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI  is displayed in green.

 xao 11TH SEPT 2020

The index is looking sick. Volume indicators are down and so is price. The Nasdaq in the US is approaching short term support so will that slow the down trend? If we are really in the next bull market, the Nasdaq will attract buyers and rally again. I suggest that is the index to watch as the new economy is all about technology, so it seems.

MARKET COMMENTS: As of 4/9/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI  is displayed in green.

 

xao 4th sept 20

So. Last week I asked the question was the pullback happening soon? as the volume indicators were starting to turn down into possible negative territory. You can see on the chart above the XAO is now below the bull filter, so there will be no more buying if you are using a filter like that. I have been testing alternative and additional exits for the eBook system, as the pullback in March was too much for most people, bearing in mind it was an extraordinary event. I will be discussing those exits at my online ATAA meeting on the 21st Sept.

So where is support? Well in my opinion support is where the US markets decide it is, our market will follow it down, perhaps not as much, as we have not rallied as far as the US market has since the March lows.

 

MARKET COMMENTS: As of 28/8/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI line is displayed in green.

 XAO 28TH aUG 20

 A big volume bar this week, and price is down slightly. The OBV hangs in there but the MFI looks to be breaking down a little. Is this the correction many have been waiting for?

 

 
 

 

MARKET COMMENTS: As of 14/8/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI line is displayed in green.

 xao 14TH aUG 2020

 Market strength continues. Last week I mentioned the Russsell 2000 in the US, it had a flat week. Not much to say this week. If you are a trend trader good times are back.

 

MARKET COMMENTS: As of 7/8/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI line is displayed in green.

XAO 7th Aug 20

Not much to say this week except the XAO index is hanging in there. This week there are five new 52 week closing highs in the ASX 300, with commodity stocks dominating. Also two more commodity stocks in the 300 - 500 sector. A chart I find interesting is the Russell 2000 in the US. The talk has been the stock rally is a bubble led by the Nasdaq, if that is the case why is the 2000 mid caps in the US so strong? Chart below. Perhaps the rally is more broad based than once thought. The indicators on the chart below are a 14 RSI and a MACD.

RUT 7th Aug 20

 

 

MARKET COMMENTS: As of 31/7/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period. The MFI line is displayed in green.

 XAO 31ST JULY 20

A pullback this week on some higher volume. Is this the pullback many have been predicting? We do not have a break down in volume trend lines yet, like we did before Covid hit. Lookling back at March you can see the OBV trend line broke down and the MFI had already been trending down for some time. This week will be a tester, if it falls below the EMA well then of course the eBook system will stop buying, but a sharp sell off could happen because there seems to be so much nervousness about this market at the moment. 

 

MARKET COMMENTS: As of 24/7/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 XAO24TH jULY 20

Everytime I look at this chart, I see strength. Prices are rising and so is volume. Perhaps when we get good news about Corona virus, the markets will fall, because all the bad news is not slowing down the uptrend. I ran a scan on the eBook system today. There is a philosophy that the stocks that first give buy signals after a bear market, are the stocks that lead the next bull market. The eBook system signalled buys on the 1/6/20, after its Bull filter kicked in to buy mode.  Out of the 19 stocks that were bought 9 were gold stocks, if you include FMG that would make it 10 of the 19. So, it appears by far that the Gold sector is the new bull market, with a few resource stocks tagging along for the ride. Below is a list of the stocks the system is holding in the top 300. The system currently holds 18 stocks so one will be bought on monday, that will be HUB.

The system has had a good month rising 10%, recovering somewhat after being clobbered in March and April.

Note: the entry date below for each trade is the Friday (5th) of the week, the correct date is actually the Monday 1/6/20

ebook stocks

 

 

 MARKET COMMENTS: As of 17/7/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 xao 17TH jULY 20

 It is an interesting market this one. One of the themes in the book I am writing is to look at the market with a mind of interest, not fear. If you can do that it can do wonders for your trading by just adjusting your perspective.

This week there was uncertainty, the US market has stalled a little and some of our Tech stocks came off the boil. A rotation appears to be happening. I notice this week a return to dividend paying stocks, Resources, Staples and even Utilities, although not in an uptrend, seem to be getting some love. Perhaps for the dividends. I see this as more conservative investors returning to the market, now feeling more safe as the dust settles. Also the question, where else do you put your money?

I have been talking about a repeat of the late 1990's rally. Below is a video from an American commentator suggesting just that.  Its 8 min long. Have a good week.

https://www.youtube.com/watch?v=Jj_-yTpvQDc

 

 

MARKET COMMENTS: As of 10/7/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

XAO 10th July 2020

 The look of this chart has hardly changed from last week. A flat week here in Aus but overnight the US rallied again and so gains will be expected here on Monday. Below is a chart of the Nasdaq in the US.

Last week I discussed the rally in 1998 to 2000, it looks to be happening again. Before covid I was of the opinion the markets were going to "melt up", in hindsight it seems I was correct, with the crash in March being the buy opportunity of a lifetime. In 1998 the Nasdaq broke through 2000 to make 5000 in 18 months. A repeat of that will take us from 10,000 to 25,000 by mid 2021. So, the decison we all have is how to play this market. A momentum system with tight stops may be the one to use, but whatever one uses it could be a bumpy ride.

 

Nasdaq 10th July 20

 

 

MARKET COMMENTS: As of 3/7/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

XAO 3rd july 20

The index rose again, strength remains in Tech, Health, Gold and Consumer stocks like COL and WES.  We live in interesting times as the market defies what most economists think, that the economy will struggle post Covid. This index is telling us the opposite. The Nasdaq in the US is even more defiant, I can't but help liken what is happening now to 1998, when the Nadaq fell 30% to rise another 300% before crashing in 2000.

 

 

MARKET COMMENTS: As of 26/6/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 

 XAO 26th june 20

Things have changed a little. On the weekly chart the index went sideways to slightly down this week. The OBV trend line has broken its trend line to the downside, although it has not made a new lower low. The 13 weekly period of the Money Flow Indicator is at very high levels, this is not to suggest the market will fall, but buyers may be a little tired at the moment. Without buyers the market will drift sideways to down. Below is a daily chart...

XAO daily 26th june 20

In the daily chart above I have drawn some more trend lines, and changed the MFI to a 5 period, to reflect a weeks price/volume action. Trend lines are holding on the price and the OBV, but MFI looks to be under pressure. The MFI is a more dynamic indicator and will reflect short term movements more, as with all short term indicators they can lead us off path. We know the US market fell on Friday so no doubt we will open down on Monday, if that daily OBV trend line breaks down, I would expect short term traders will run for the exit. I would think more cautious traders will exit on Monday.

 

 

MARKET COMMENTS: As of 19/6/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 XAO 19th June 20

There seems no stopping for the XAO index at the moment. A big volume bar this week as money continues to come into the market and the price rises. Indicating that buyers are overwhelming sellers. Despite the doom and gloom and the constant talk of the economy in dire straits, the index is defiant. Volume indicators (the OBV and MFI) are still pointing up.

The Australian stock market is shifting. It has been for some years as the banks dominate the index less. Other sectors are emerging to take up more of the index weighting. While the financial stocks languish, sectors like consumer, health, tech, and gold are very strong, helping to push this index up. Traditional sectors like banks, utilities and energy continue to languish. To me I am undecided as to how the resources sector is looking, some companies are going well but others not.

So, are we in the throes of the new economy? An economy now driven more by the needs of the domestic consumer. I notice the property sector is strong too, below is a chart I used at a recent talk I gave about the Real Estate Investment Trust market. I used this chart to discuss the theory of the 14 years property cycle that some adhere to.

No drop off of money here, in fact quite the opposite, its pouring in. If I were the Federal Government I would be doing the same, support this sector. It's the 2nd biggest income earner in the country and creates the "wealth effect" encouraging people to invest and spend. The strategy seems to be working.

Until next week.

XPJ 19th June 20

 

MARKET COMMENTS: As of 12/6//20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 XAO 12th June 2020

A pullback in the US had the same impact on the XAO. Volumes remain intact, the volume on this weeks trading bar was lower than the previous two bars. The OBV trend line is still in place and the Money Flow Indicator still pointing up, but it is a 13 week calculation. If I look at it on a 6 week calc (not shown) it looks over bought. The markets are responding to the number of Covid cases, I suppose it will take some time to know how deep the impact on the global economy will be. I would think markets will then react to different stats and the true impact of what has been happening the last 3 months will become apparent.

There are very few 52 week closing highs this week. None in the 300, just one in the 300 to 500, and none for the eBook system. Not surprising considering the pull back in the XAO. I counted up the stocks open in the eBook system, out of the 19 there are 8 gold stocks. Will gold lead the next bull market? If not then the sector seems to be the strongest at the moment.

The eBook system entered the market on the 1st June and is down 2.5% because gold stocks have stalled, however that can change very quickly as it is a dynamic sector.

 

 

 

 

 

 

MARKET COMMENTS: As of 5/6//20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 XAO 5th June 20

The rally continues, and looks set to continue next week after better than expected employment figures announced in the US last night. Are we living in a fools paradise? Is this just a bear market rally? Is it a new bull market? Have we entered a new paradigm of finance and economics? Perhaps, as I read an interesting statistic that Nike lost money from closed stores in the US but more than made up for that with increased online sales in China. Last night the Nasdaq made all time highs, surpassing the highs before Covid. The V shape recovery in that index confirmed. The US dollar is falling therefore increasing commodity prices, good for Australia but gold has fallen as the "risk on" mentality returns. And perhaps the most interesting, the Russell 2000 in the US, their mid cap index, is rallying hard to, indicating there is breadth to this rally. There has been a concern that the rally in the US was all about the FANG stocks, but the Russell is showing that is not the case anymore and that confidence is returning to other stocks other than FANG.

 

 

 

 

MARKET COMMENTS: As of 29/5/20: See charts below

The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 All Ords 30th May 2020

What a difference a week makes. The banks joined the recovery rally this week driving the XAO index up. The OBV is at all time highs (what a strong and reliable indicator that seems to be) and the 13 week period Money Flow index has well and truly broken its down trend line from last weeks chart. The big news this week is the Bull filter that the eBook system uses is in buy mode, you will see below the signals that system has given. Last week I said I had a feel the market was due for a pull back, goes to show how dangerous it can be to make an assumption or prediction.

I did say last week it depends on the inflow of capital into the market, more buyers, more upward momentum. That happened this week.

 

 

MARKET COMMENTS: As of 22/5/20: See charts below

 The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 XAO 22nd May 20

This is interesting, the OBV indicator has made an all time high but the faster moving 13 week Money Flow Indicator has not, it is pointing down. Also the bull filter is still not active so the eBook system won't be giving buy signals yet. I am still out of the market with any trading system, while I enjoy the break and get to work on some long overdue tasks. Next week will be one to watch to see if the market can continue the rally or pull back.

At some point buyers will stop buying and there will be great temptation by those that bought a few weeks ago to sell and take profits, the market needs money going in to go up, and will go down if money comes out. I would like to see more consolidation and volume confirmation, so in a way I am glad the bull filter has not signaled because my intuition is telling me this market will pullback soon. We are in the seasonal time of the market when it does fall. "Sell in May and go away" does have some historical merit to it. The market seems to fall from May to September/October, followed by a rally into Christmas. If you want to read an interesting article about it click on the link below.

https://www.investopedia.com/terms/s/sell-in-may-and-go-away.asp

Of course this time may be different because of all the stimulus and the fact we have had a big fall for 2020. However we need money going in, and I am wondering for the time being if investors and traders have empty tanks and possibly empty hearts to take any more risk.

 

 

 

 

 MARKET COMMENTS: As of 15/5/20: See charts below

 The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

 Xao daily 15th may 20

I am again displaying the daily chart of the All Ords, so the MFI is using a 13 period daily. Is it a sideways move or a slow uptrend? The volume on the Money Flow Index broke up early this week, a positive sign, only to pull back again. I have noticed that on Fridays the market sells off, my guess is traders do not want to hold over the weekend. Some sectors are flying, like gold, and resources and materials are going up too. The tech index has had a big rally also. The financial index is not enjoying the rally, and would be really holding back the look of the All Ords and the ASX 200 as these indicies are weighted heavily to banks. Another sector performing well is the Mid Caps. So as always, the chart above does not really show what is happening within the market, it remains a broad indicator. For example, looking at the weekly chart below of the Gold sector index, the bull filter kicked in 4 weeks ago and I notice the OBV has made an all time high. Something to work on and consider for future strategies.

XGD weekly 15th may 20

 

 

 MARKET COMMENTS: As of 8/5/20: See charts below

 The chart below has two volume indicators, the On Balance Volume (OBV) and the Money Flow index(MFI) using a 13 week period.

XAO 8th May 2020

This week I will discuss the daily chart. As it is the short term that most seem to be wondering "what is happening?" The weekly chart has not changed a lot from last week, yes we had a rally of 160 points, or 3%, but this index is in a sideways move for the moment, will it break up to more highs? We need buyers to push the market higher, more money in means higher prices. It seems the indicator to watch is the 13 period Money Flow Index. What period to use is always the big question with any indicator. Using the 13 period you can see the index started to turn up before the recovery rally started in mid March. If it breaks out of its consolidation lines I have drawn on the chart above, it could be a bullish sign.

We need to always keep in mind the longer term charts. On a weekly scale, filters to signal a return of the Bull have not signalled. I am still sitting out of the market. As frustrating as that can be, particularly with the way some stocks have recovered, for me it is my strategy.

On a personal note,I am feeling vindicated about my analysis that the Covid sell off was completely over done, (but things could reverse quickly). However, "being right" about the market does not always make you money. One needs to remain patient and disciplined.

Have a good week.

Peter

 

 

 

 

 MARKET COMMENTS: As of 1/5/20: See charts below

 

 XAO 1st may 20

 I will start this weeks comments with a weekly chart. As you can see the moving average used for the eBook system is trending down, so there are no buy signals if you are using some sort of weekly market filter, such as that method does.

The index fell this week, all on Friday, the Money Flow index is trending down. As I said last week I would like to have seen more volume coming into the index, but it was not there. The OBV indicator is holding up well, but it is a slower indicator.

As I write I notice the US indexes are down, so one would expect more falls on Monday in the XAO. If the market makes a double bottom and the OBV holds that trend line it could be a good buy opportunity, but we will have to wait and see. If the Money Flow index is still pointing down I would not be buying. Of course I am talking about those that wish to attempt to time a bottom, which is extremely difficult. The safe thing to do is wait for the market to show strength before buying back in. As I often say, one weeks price action does not make a trend, but that is a very bearish looking weekly bar we had this week.

The following chart is in a monthly scale, the Money Flow index had been adjusted to a 3 month period.

XAO monthly 1st may 20

 On a monthly scale the XAO index looks surprisingly healthy. However we have to remember that the shorter term charts "turn" first and will give us a quicker signal to what is possibly ahead of us.

The OBV indicator is still intact. The MFI does lag a little on a monthly scale, but you you can see how oversold it was in mid March. You can also see it can go lower as it did in 2008 and again 2010 before it started trending higher to indicate the recovery was underway.

Putting all that technical jargon to one side, consider this. The market will go up with buyers and down with sellers. It is why the volume indicators can tell us what the mood of the market participants are. I see the longer term and reliable OBV as the poker "tell" in this scenario. I will be watching it closely over the next few weeks.

Below are the 52 week closing highs for this week, signaled without using a market filter. As expected a gold stock made the list, if the trend of the gold index continues up one would expect more in the coming weeks. This happened in 2008 when the gold sector was one of the few sectors producing new highs as the majority of the market fell.

Have a great week, Peter.

 

 

 

 MARKET COMMENTS: As of 24/4/20: See charts below

XAO 24 April 20

The market pulled back this week, in one week the volume indicators wont change much. You can see above they are similar to the week before. Below is a daily chart.

XAO 24 April 20 daily

I would like to see more volume coming into this rally. The daily chart above does not reflect the strong day Wall Street had last night, so you would expect our market to rise on Monday. Looking at the daily chart it appears this market has a bit of work to do before we can start talking about a V shape recovery.

Now, if we want to look at a bullish chart check out the one below. Soon I expect to see 52 week highs in gold stocks.

XGD 24 April 20 daily

MARKET COMMENTS: As of 17/4/20: See charts below

XAO 17th April 20

The chart above of the All Ords shows a bar chart with two volume indicators, the On Balance Volume and the Money Flow Index using a 13 week period. I use the 13 week period as it is one calendar quarter. The long term trend line on the OBV remains in tact. Last week I said would like to see more volume and this week we got it. Are we in for a V shaped recovery?  I read some research the other day stating that only 17% of market commentators felt the market would recover quickly. Does that mean the opposite will happen and in a few months we will be back to normal? The market has a habit of surprising most.

A test will be when the price of the index reaches that trend line I drew on the chart. A pause would be expected and it will be watched closely to see if it can break through to the upside. 52 week highs below, a few more this week. The Bull filter for the eBook system is still negative.

Peter.

 

 

 

MARKET COMMENTS: As of 9/4/20: See charts below

 XAO 9th April 2020

The chart above of the All Ords shows a bar chart with two volume indicators, the On Balance Volume and the Money Flow Index using a 13 week period. I use the 13 week period as it is one calendar quarter. The long term trend line on the OBV remains in tact. I would like to see more volume in the Money Flow Index. Ideally a trend line break to the upside. I have lots of longer term charts posted below, as a matter of interest you might like to scroll down and re read my comments from the 6th March, feel free to email me with your thoughts. Peter.

I cant help myself, here is one more chart for you to digest. A quarterly chart showing a long term uptrend and the OBV indicator on top displaying definitive support.

xao 9th April Quarterly

 

 

MARKET COMMENTS: As of 3/4/20: See charts below

This chart below shows two volume indicators, the On Balance Volume and the Money Flow Index (displayed in green) using a 13 week format for weekly charts and a 3 period for monthly charts.

Older charts are repeated lower down the page along with comments from previous weeks. The 52 week highs are also posted below.

XAO 3rd April 20

I have kept it simple again this week, using a line chart on the XAO, in a weekly format.

As you can clearly see, price and volume are on support lines. We have had a small bounce.

I am not a fan of Fibonacci however I do notice the rally has stalled at the 38% mark, Fib fans will know the possible significance of this.

This market looks oversold and ripe for opportunity, but the news is Trumping (joke intended) the technicals. What concerns me more is the daily chart below.

XAO Daily 3rd April 20

The OBV line has broken down on a daily chart. Also the 13 period (daily) Money Flow Indicator is meeting overhead resistance.

Its all about the money folks, no money going in, no upward momentum. Buyers need to overpower sellers.

Add to that the bad news coming from the US about Corona and one would expect (dangerous word that one for a trader) more falls.

Remember something important (in my opinion). Charts reflect the emotions of market participants. The chart above indicates to me that traders are being very cautious.

I am.

Just to confuse things (sorry , we live in confusing times) when I zoom in on the On Balance Volume, its doesnt look so bad. You can see why it is so hard to analyse short term charts and why many traders sit out during these times.

Whatever you decide to do this week, I hope you come up trumps!

obv 3rd march 20

 

 

 

 

 

XAO Monthly 27th Mar 2020

XAO 27th Mar 2020

I like to keep charts as simple as possible so sometimes I find line charts the easiest to help determine the big picture, so I have used one for the monthly chart of the XAO 500.  Although not shown on the monthly line chart above, we did get a bounce, which you can see on the weekly bar chart. I have always maintained that the bull market started in early 2013, not in 2009 as so many claim it did. Interesting to note that the price of the index has fallen all the way back to the levels we had in 2013, wiping out the bull market gains from that date. Perhaps too wiping out the economic "fluff", weak companies and over borrowing, something that many economists have been saying needed to happen to reset the economy on a more sound footing.

From a technical perspective the charts look to be at a very strong support area. The monthly chart shows a massive divergence between price and volume, as it did in 2003. I have drawn red lines on the Monthly chart to show this.

The weekly chart shows the On Balance Volume indicator still in a solid uptrend. It also shows the Money Flow Indicator (using a calendar quarter period of 13 weeks) at rock bottom levels. When and if the OBV trend line breaks down, then I would anticipate more selling and another wave down to perhaps 4000, but one would think it would consolidate at the long term tend line of 4500. My experience is that upward trend lines give far more support than do horizontal "support and resistance" areas.

As I said last week in my news letter, the above is all technical "stuff". The fundamentals of the economy now rely on how it copes with the shutdown and we can only wait and see.

All the best till next week.

 

 

MARKET COMMENTS: As of 23/3/20: See charts below

 

23 rd March 20 Monthly

How low will it go?

This is the big question. Normally we can have an idea by looking at the charts to determine where the probability of either support, or even a reversal may happen. However as many have already alluded to the fact "this time it's different."

I am writing this on monday 23rd March after the days trading.

The market has closed down again, and the reversal of price and MFI just gets more pronounced. Normally I would be screaming buy, but I think this time fundamentals are overtaking any support from the technicals. I almost can't believe the OBV indicator is trending up, either the indicator is broken or we are in for one hell of a bounce.

 MARKET COMMENTS: As of 13/3/20: See charts below

 XAO 13th Mar 20

Well I suppose the big question is."Are we now in a bear market?" I suppose many would say yes!

Perhaps I remain too positive, but when I look at the chart above,  the answer is, not yet.

Also, where did the bull market start? At the very end of the GFC in 2009, or 2013 after 4 years of ups and downs and accumulation? Have we really had 11 years of a bull market? Or 7 years from the break out in 2013? Normally when bull markets bust the OBV line breaks its down trend. It has not, yet. The other volume indicator on the chart above is the 13 week Money Flow Index, it is certainly in oversold territory. As we are driven by the US markets, let's look at what that chart looks like.

SPX 13th Mar 20

If you didnt know about the Covid 19 virus, had been meditating in a cave for 2 years, came back and saw the above chart, I suspect the thought would be "great buy opportunity".

I have updated my portfolio. It is almost completely sold out. Go to the Peters Portfolio page for details.

 

MARKET COMMENTS: As of 6/3/20: See charts below

 XAO 7th March 20

 

SPX 6th Mar 20

XAO monthly 7th mar 20

 

 I have posted 3 charts. The 1st one is the the Australian market, it has fallen harder than the US. The XAO is down around 14% (1000 points) from its recent high and the SP 500 (the 2nd chart) is down around 12.5%. The US market could fall to major trend line support at 2700, which is another 9%, which at the current rate of fall for the Aussie market, is probably another 11%. However we have major trend line support at 6000, which is about 5% away so we may pull up there if the falls continue. The 3rd chart is the monthly chart of the XAO, there is impressive divergence between price and volume. The volume indicator is the Money Flow index (green line) using a 3 month period.

 Overall this is what I see, and bear in mind all we have is the present moment. The US and Australian markets are in a long term uptrend. I do not think we have entered a bear market, although this could happen. Volume and price support are in tact, particularly in the US. The Australian market has been hit harder because of our real or perceived over reliance on China. In hindsight you can see the topping patterns the indexes were showing a few weeks ago. However topping patterns do not always result in savage sell offs like this one, this sell off is driven by panic and uncertainty, more than fundamentals, even though I acknowledge the market was expensive and perhaps over bought.

During the week I went to a seminar on stock market cycles. Before this recent event I was of the view that we were in a late cycle bull market. Late cycle bull markets can have parabolic rises mixed with extreme sharp pullbacks. They then gather steam and march up again. This happened in 1998 when the market fell 18% mid year but then rallied 28% from the low to end the year in positive territory. The scare then was uncertainty about Russia's political and economic future, not dissimilar to the current China scare. If you want to read the historical article here is the link. Interesting to note the similar rhetoric about the world ending and a bear market.

https://money.cnn.com/1998/08/31/markets/marketwrap/

Of course many will remember the rallies in late 1998, 1999 and early 2000 before the dot com bubble burst, but before that huge profits were made. So in summary.

It is too early to tell what will happen. Charts look supportive. More falls would not surprise me, but if they come charts are even more supportive. No one has mentioned yet that this drama may play into the hands of Trump, his reelection chances and provide an ace up the sleeve for trade deal talks. 

All the best for the week, it may be another tough one.

Peter

 

 

 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 28/2/20: See chart below

 

XAO 28th feb 2020

Nasdaq Money flow

Well what a week, enough to test the best of us. In one the week the world has changed. We are all wondering when will the selling end and how serious is this? Is this as bad as the twin towers attack? Or the GFC? The answer: We do not know.

The Aussie market looks no where near as bad as the US, but we did not rally as much as what they did the last 8 months. Unfortunately, it all depends on that chart of the US SP500 and perhaps more so on the Nasdaq. A reason why I posted both those charts above. The SP500 price is sitting on support, but it could fall to the long term trend line at 2700, dragging our market down with it. The volume indicators on the XAO chart look strong, and although not shown on the SP500 chart, they look similar there too.

The Nasdaq looks very supportive. Both price and the 13 period Money Flow index sitting on support.

As I said in my email on Wednesday, the markets were over bought and looking for a reason to take profits, but now it's possibly developing into panic. Despite the pullback in my portfolio surprisingly I only have 2 sell signals, plus AD8 that I missed the alert on last week.  So if the markets continue to fall next week I will have to endure some more suffering. Lucky I am a Zen priest, as suffering is my speciality, but let me assure you, it isn't easy so don't feel bad if you feel bad!

Have a nice weekend and try not to worry. I will be following my system.

 

MARKET COMMENTS: As of 21/2/20: See chart below

XAO 21st Feb 20

An interesting week. Big volume and the closing price for the week the same as last week. (give or take a few points) The CMF is still pointing down, but the OBV screaming up. What does that mean? My guess is uncertainty. In strong bull markets the non-believers and doom and gloomers are always looking for a reason not to buy, sell or short. This could be happening now. However, there is a fly in the ointment for the shorts. The Russell 2000 in the US has been a laggard in this market, but if you look at a monthly chart it looks to be changing its mind. It will be a very positive indicator for this bull market to continue if it can make a new  all time high, which is only a few percent away. The chart is below.

Russell Feb 20

 

MARKET COMMENTS: As of 14/2/20: See chart below

xao 14TH fEB 20

 This is a very strong market. How long it continues no one knows. One thing we do know, and is a fact that often surprises many people, is that bull markets and strong trends can last a lot longer than what many think. The chart above shows a slight volume divergence on the CMF (Chaiken Money Flow) indicator. Many traders and investors place far too much importance on indicators, they are a guide only and what needs to be remembered is that price is the ultimate indicator. So, the price is telling us that this market is going up. The bull filter is active, it's all go. As a beginner your focus should be on finding a system that suits you, one you feel comfortable with. If you have that process in place, your focus needs to be on developing your mind. The development of your thinking needs to go hand in hand with the development of your process.

It doesn't matter how strong any market is, if you do not have good process and good mindset, profits will ellude you.

Have a good week.

MARKET COMMENTS: As of 7/2/20: See chart below

XAO 7th feb 2020

The market continues its' pullback. That is a strong close on this weeks bar. However! and don't ever forget this. One weeks price action does not make a trend. Now we are in stage 3 of the bull market, volatility will probably increase. Why? Because markets are driven by emotion. The fear of loss and the fear of missing out will dominate this market for the time being. When I say the time being, I mean until there is a clear sign this bull market is over. That sign has not yet come, so as emotionally difficult as it may be, your best option is to plan your trade and trade your plan.  Do I sound like a song stuck on repeat? Good. Repetition of good process is what this game is about. Have a good week, stay calm, stick to the system. Size your trade, buy the signal, sell the signal, repeat the process. Trading can be easy but we make it hard.

MARKET COMMENTS: As of 31/1/20: See chart below

XAO 31st Jan 20

 

The market did pause a little this week. Does it listen to my comments or is everyone reading this web page?!

This market still looks very strong despite all the concerns. Are there not always concerns?

Volume indicators are up, price is up, bull filter active. It's a no brainer.

You know what to do. Follow the system and hold your nerve. If you are stressing you either have the wrong system (for you) or your position sizing is too large, or perhaps you have too few stocks creating portfolio volatility. A reminder the eBook system carries an average of 20 stocks, to spread risk and volatility.

Adjust, re think, re group, carry on, it's all just a process.

or ring 0403821523 for some coaching, before I run off to my cave again. That's always a strong chance.

Have a good week.

MARKET COMMENTS: As of 24/1/20: See chart below

xao 24 jan 2020

The market rose a little this week. I notice the CMF volume indicator (in green) has double topped and is pointing down. However the OBV is still rising strongly.

A pullback or some sort of pause now would not surprise me, but either would more upward momentum. This is the problem with T.A. (Technical Analysis), which really means chart reading. It is just very difficult at times and also quite subjective. The CMF is not a strong indicator, it can take time for price to follow its lead, although it did give an early warning back in Aug/Sept 2018.

Dynamic bull markets challenge our nerve, but if you know your exit, and position size correctly, try and enjoy the ride, instead of stressing about when you will get off. The market will tell us when to get off, at the moment it is saying hang in there.

 

 

MARKET COMMENTS: As of 17/1/20: See chart below

xao20th jan 20

 There is a Zen saying "if it is not necessary to say anything it is necessary to say nothing".

However for those of you that really need to read something, I have posted below what I wrote last week.

Well we have a breakout. I would like to see more volume, but a breakout is a breakout and sometimes we want more than what the market gives us. Many have been waiting for this breakout for confirmation of the bull market in Australia, so will those people now buy?

In my opinion we have entered stage 3 of the bull market. For those of you that do not know about market stage analysis, stage 1 is consolidation or a recovery from a bear market. Stage 2 is the "disbelief stage" or the stage when no one believes we have a bull market (I was writing about this a few years ago). Stage 3 is the strongest phase, where prices rise at rapid rates, big money can be made (or lost) and volatility increases. Examples of stage 3 markets would be the late 1990's before the tech crash and then a decade later during a few years in the lead up to the GFC in 2008.

What to do and how should you trade it? Guess what I will say next :)

Have a method and stick to it.

 

MARKET COMMENTS: As of 10/1/20: See chart below

XAO 11 jan 20

Well we have a breakout. I would like to see more volume, but a breakout is a breakout and sometimes we want more than what the market gives us. Many have been waiting for this breakout for confirmation of the bull market in Australia, so will those people now buy?

In my opinion we have entered stage 3 of the bull market. For those of you that do not know about market stage analysis, stage 1 is consolidation or a recovery from a bear market. Stage 2 is the "disbelief stage" or the stage when no one believes we have a bull market (I was writing about this a few years ago). Stage 3 is the strongest phase, where prices rise at rapid rates, big money can be made (or lost) and volatility increases. Examples of stage 3 markets would be the late 1990's before the tech crash and then a decade later during a few years in the lead up to the GFC in 2008.

What to do and how should you trade it? Guess what I will say next :)

Have a method and stick to it.

MARKET COMMENTS: As of 3/1/20: See chart below

 XAO 3RD JAN 20

Another short trading week of 4 days due to the new years day holiday. The index continues to trade sideways despite indexes overseas continuing to rally up. We go into the new year with uncertainty, but of course this is always the case in the markets. Think of the uncertainty that existed this time last year and then the year of great results that followed. Our resources sector is one to watch, particularly the gold market as the gold price has a run up. However some of the gold stocks are not responding as strongly as I would have thought, perhaps they are telling us the gold rally may slow soon?

MARKET COMMENTS: As of 27/12/19: See chart below

xao 27th Dec 19

 A quiet week this one, as is to be expected with the Christmas holidays. A reminder that although it is only a 3 day trading week, as is next week, they are still regarded as a weeks trading and the rules of weekly systems are to be followed accordingly. A fact there are no buy signals this week is a coincidence, it has nothing to do with the 3 day trading week.XAO 20th Dec 19

 This week the XAO went up with some hefty volume behind it. Well "its all happening" as those of you who remember Bill Laurie the excitable cricket commentator, would say. Lots of new 52 week closing highs this week, perhaps as a result of the Brexit and English situation settling. Also those of you that attended my ATAA lecture at Newcastle on Saturday 14th will recall me saying it seems more money is coming into the market. It has certainly been a dynamic year and great rewards for those that have stuck to their system. The eBook system is now sitting on 31% p.a for 2019 (more if you were compounding from the year before) and as of the end of this week, Peters Portfolio is up over 50% for 2019. I wonder how the year will end? I wonder how next year will be? Perhaps you could ask not why, but what? What is happening and what can I do about it? Remember my mantra from the eBook...... There are 2 reasons why traders do not make money from the market. 1/ They do not have a method 2/ If they have a method they won't stick to it. I can help you with both those in 2020. Merry Christmas and Happy New Year.

 

 

MARKET COMMENTS: As of 13/12/19: See chart below

XAO 13 Dec 19

 Well its hanging in there. A quiet week really. It looks like the conservative party in the UK have a decisive victory. As markets hate uncertainty I would think that this would be a confident booster for markets globally. In the short term I notice the FTSE 100 futures (top 100 in UK) has rallied. As I often say, time will tell on that one. Not many 52 week highs this week in the 300 as the XAO continues to consolidate. Most portfolios continue to track sideways to down, as some big trenders from early in the year get stopped out, a natural churning of the market as money reallocates into the next strong stocks.

 

 

MARKET COMMENTS: As of 6/12/19: See chart below

XAO 6th Dec 19

The short term trend line of the OBV has broken, although it is short term, and it has not made a lower low. The CMF (green volume indicator) is on support. The Bull filter is active (just). I did say quite a few weeks ago I thought the market would go sideways a while until it was ready to move up again. Last week it looked like it was breaking up, but Donald stopped that by increasing uncertainty. Nothing we can do except hang in there and follow our systems for no one has any idea of what will happen next. That is the good part about having a committed method, while others flounder we just follow our rules.

 

 

MARKET COMMENTS: As of 29/11/19: See chart below

xao 29 nov 19

The index rallies. However it seems to be mainly in the top 50. The smaller stocks not responding as well. So, if you are like me and have a lot of holdings in small and mid caps you are probably not seeing the gains. In saying that, I notice the Russell 2000, the mid cap index for the US (which are still gorilla stocks by our standard) has made a 52 week high. We keep hearing how the economy is struggling, but if you look at the XDJ, the Consumer stock index, it's going ballistic. So something does not stack up. Are people spending more than what the figures are showing? The market can be a leading indicator, perhaps the economy is due for an uptick. Have a look at the XPJ too. The property sector looks strong which also bodes well, as we all know the property sector drives our economy.

 

 

MARKET COMMENTS: As of 22/11/19: See chart below

XAO 22 NOV 19

Is that a reversal bar for this weeks trading? One bar and one weeks trading does not make a trend. The XAO is above its Bull filter, volumes are up, trend is up. How are you going adopting a "don't know" philosophy about what will happen and sticking to the system? It was a lack lustre week really, on low volume, people are still nervous, anxiety rules, don't get caught up in it.

 

 

MARKET COMMENTS: As of 15/11/19: See chart below

 XAO15 Nov 19

Last week I said: "So much doom and gloom persists in the news but the charts don't reflect this. The SP500 and the Nasdaq in the US continue to rally, it's only a matter of time before that positivity catches on here in Aus. A falling gold price bodes well for the markets in general, perhaps fear is subsiding and more confidence is creeping in about a US/China deal. Time will tell."

And a few weeks ago I said: "The overall market looks extremely bullish with a positive divergence between price and volume (the OBV)"

Well time didn't take long. The XAO has had a strong rally on good volume. Price and volume trend lines have been broken to the upside. Regular readers will know what I will say now.

Follow your system. If you don't have one, get one and stick to it. Its the best way to succeed in the market.

 

 

MARKET COMMENTS: As of 8/11/19: See chart below

XAO 8th Nov 19

I mentioned a few weeks ago I thought the market (when I say the market I mean this index chart) needed to churn and perhaps go sideways a while. It seems to be doing that. Interesting to note their are 7 new signals in the eBook system this week, indicating the market has strength. The index chart above has been dragged down by the big 4 banks, Macquarie being an exception. So much doom and gloom persists in the news but the charts don't reflect this. The SP500 and the Nasdaq in the US continue to rally, it's only a matter of time before that positivity catches on here in Aus. Those holding gold stocks I hope have taken their stops, Peters Portfolio was stopped out of most gold stocks quite a few weeks ago, the gold price looks like it has further to fall....but as usual no predictions here! Just follow the system. I notice NCM has been stopped out from the eBook system. A falling gold price bodes well for the markets in general, perhaps fear is subsiding and more confidence is creeping in about a US/China deal. Time will tell.

 

MARKET COMMENTS: As of 25/10/19: See chart below

xao 25th oct 19

 Despite the market index rising, this week ending 25/10/19 the eBook system fell 2.6%. Peters Portfolio fell 1.5% with some changes made last week (2 buys, 2 sells). The index gains were driven by the big 3 indexes, banks, resources and health. Tech fell. The eBook portfolio and my portfolio do not hold a lot of stocks in the 3 bullish sectors mentioned, so they suffered a pull back. The overall market looks extremely bullish with a positive divergence between price and volume (the OBV). Last night the Nasdaq broke up and out of a consolodation period which bodes well for tech stocks. I was saying to a client the other day this market could now really take off with many sectors chiming in for the rally. The strength of this market is not talked about much, doom and gloom persist, my experience is that means the market will run higher. We need irrational exubrance to exist in a big way before markets crash. We are not at that state of delusional thinking yet.

MARKET COMMENTS: As of 18/10/19: See chart below

 

xao 18 oct 19

The market started the week well but faded into Friday. The longer term volume indicator of the OBV looks very positive, the shorter term 13 period CMF is sitting on support. The Bull filter is active and there are some signals this week, more than last week so stocks are still trending up. There seems to be some churning going on as the market goes through a consolidation period. I have discussed churning before. It is when there is indecision by traders and investors as to what sector to be in. Will resources rally, will gold recover, can tech and health stocks continue their march upward, is the consumer sector really that bad? It's all enough to drive one crazy. However consider this, if you buy stocks that are trending up and sell the ones that are trending down, do you really need to know what sector will rally next? We don't really need to know to follow the system, the churners will decide for us. They will sell the stocks they feel will fall more, and buy the ones they think will go up. What will we do? Buy the signal, size the trade, sell the signal, repeat the process. Too simple? That method has returned 57% in 21.5  months. Peters Portfolio had a small rise this week, I have posted the PDF on the Peters Portfolio page.

 

MARKET COMMENTS: As of 11/10/19: See chart below

xao 11 oct 19

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 (except WBA a takeover) 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

XAO 4TH OCT

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%.

Monthly4TH OCT

MARKET COMMENTS: As of 27/9/19: See chart below

 XAO 27 9 19

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

XAO 20th sept 19png

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

XAO 13 sept 19

MARKET COMMENTS: As of 13/9/19: See chart below

XAO 13 sept 19

 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

 XAO 6th sept

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

 XAO 30 Aug 19

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)

 XAO graph 23 aug

 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.......

 XAO 2 graph 23 aug

 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.........

SP graph 23 aug

 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)

xao 16 AUGUST

 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)

xao 9th aug19

 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)

xao 2nd august

 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)

 xao 26th july

 

 

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)

 

xao graph19th July

 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)

 XAO 12 Jun 19

 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)

xao 5th july 19

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.

Monthly bull

MARKET COMMENTS: As of 28/6/19: (see charts below)

 market

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)

 

c

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)

 

 xao 14th June 19

" 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)

 

 XAO graph 7 june

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)

xao 31may

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)

 Untitle

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.

 

Property chart

MARKET COMMENTS: As of 17/5/19: (see charts below)

XAO graph 17 may

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)

XAO graph 10th may

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)

 

XAO 3rd May 19

 

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)

 xao graph

 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)

 XAO graph 18thApril 19

 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)

 

 

xao 12TH aPRIL 19

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. 

XNI graph 12th April 19

MARKET COMMENTS: As of 5/4/19: (see charts below)

XAO graph 5th April 19

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)

 XAO graph29 Mar 19

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)

xao graph 22 mar 19

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)

 XAO graph 15 mar 19

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)

 

Xao graph 8 Mar 19

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)

 XAO graph 1st March 2019

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.

US SP500 graph 1st March 2019

MARKET COMMENTS: As of 22/2/19: (see charts below)

XAO 22nd feb 19As 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)

 

XAO graph 15 Feb 19

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.

XMJ graph 15 Feb 19

MARKET COMMENTS: As of 8/2/19: (see charts below)

 XAO 8th Feb

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)

XAO 1st Feb 2019

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)

Xao 25 Jan

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)

XAO 18 Jan 19

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.

Fib

MARKET COMMENTS: As of 11/1/19: (see charts below)

 XAO 11 Jan 19

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)

XAO 11 Jan 19

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)

XAO 28 Dec

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.

http://www.easysharetradingsystems.com.au/products-and-services/archive/listid-1/mailid-142-a-line-in-the-sand

 

 

MARKET COMMENTS: As of 21/12/18: (see charts below)

XAO 21 Dec 18

 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

this week.

 

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

upside.

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.

http://www.easysharetradingsystems.com.au/products-and-services/archive/listid-1/mailid-140-spring-falls-but-flow-remains

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

rose 0.4%.

 

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 suggesti