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This was a roller coaster week – 3 days down followed by 2 days to climb back to exactly where the week started - only for things to fall off a cliff on Friday when the XAO fell back to almost precisely (but importantly, not below) Wednesday’s low. Price is sitting on the lower boundary of a price channel that’s been holding since 15 June. If prices keep heading lower next week and break out of the channel, I’d expect it could fall back to 5,832 (8% off last week’s high) which would almost be a technical correction (10% decline).

This week I sold BHP after it fell back 6% and broke my stop loss. My trade was about break even but having sold when the stock went ex-dividend, I made a small profit (including the dividend) of about 2.2%.

I also sold AGL when it broke my stop loss. It had a drop of over 11% on an release that failed to impress the market, recovered a little and then fell lower to make a new 5 years low. The trade never fired so it never advanced beyond the original tranche meaning my exposure was small (I initially buy about one third of my planned total purchase and then top that up as price moves up).

I bought SXY during the week (see last week’s blog and my stock commentary page) and after today’s stumble by the market I’m still in profit – so hopefully next week will see SXY move up.

I’ve seen a number of promising trades building through the week but with today’s decline possibly predicting more falls next week, now is perhaps not the time to buy. That said, one that did catch my eye was CSR. I backtested CSR this week to determine some long-term trading rules and it really showed a great result with 5 positive and no losing trades from 2015 to date. The overall return was 221% based on the simplified trendline trading technique outlined in my educational material. The backtest also confirmed a new trade could have been entered in April and as price is currently not far in front of where it was back in April, I may buy in next week (assuming market Armageddon doesn’t seem to be happening!). The backtest will be on my video stock commentary soon – check it out. CSR was one of only a few stocks to rise today - that has to be another positive.

Contact

Robert Norman

Phone: 0428 346 951
Email: robert@sharecharting.com.au

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