The Home Trading Blog

Let’s start with the good news first. I can see more and more stocks being in a confirmed downtrend according to the Home Study Course rules, which means once the market turns up again, there will be plenty of buying opportunities.

What a week, as I was reading in one article – it was a blood bath. I wrote last week that we will see either big falls or a big gains after the US debt ceiling vote. Although many private investors would have thought otherwise (after the vote), markets had their biggest one day fall since the beginning of the global financial crisis and there are doomsayers saying this one will be worse than the last time. Let’s wait and see and get everything into perspective. The overseas markets had a fantastic run since June last year (not necessarily the Australian market though). And so far we have seen just over 38% retracement of the rise for the Dow Jones index. This is a very normal retracement for a cycle and we need to wait and see how much further it will fall.

So much to the global markets, now we have a look how this affected our portfolio. As you can imagine with a number of positions already in the red, this week triggered a number of stops. We got stopped out of AGK (AGL Limited), OST (OneSteel Ltd), SGM (Sims Metal Management) and WOW (Woolworths Ltd). And if the bears continue to dominate over the next couple of weeks we will close further positions. I also mentioned last week, that we had 4 stocks fulfilling the buy criteria. I was looking at them again on Monday morning and was thinking that it is not worth the gamble with the uncertainty of the US debt crisis. For the record all buys would have resulted in a loss with the stop being hit this week.

Not surprisingly I didn’t identify any stocks meeting the buy criteria this week and I noticed ORI (Orica Ltd) having two closes below the uptrend band.

The transactions for last week were:

5th August: Sell 682 AGK @ 13.42 for a loss of 8.45%
5th August: Sell 4975 OST @1.71 for a loss of 15%
5th August: Sell 526 SGM @ 16.17 for a loss of 15%
5th August: Sell 368 WOW @ 25.41 for a loss of 6.37%

On a private note, we are going on a Europe trip for until beginning of October. I will do my best to continue regular updates to the blog but I might miss a week or have the update delayed.

The portfolio as of 5th August is:

The Australian market finished the week modestly up compared to the start of the week, whilst the major overseas markets finished the week down. Keep in mind the XJO has still some catching up to do to reach the April high. The web portfolio edged higher, with the profit of open positions up 8.41%. We still need a couple of strong weeks before Christmas to finish the year in double digits again.

Last week we added SGM (Sims Metal Management Limited) to the portfolio and it got off to a great start closing with a 5.31 % profit compared to the buy price. We also sold MTS (Metcash Limited) and ended up with almost 3% profit. Not too bad considering that it continued to fall during the week. Interestingly enough looking at the last pivot point, we had a strong bearish outside vertical bar (BEOVB) starting the current 4 week decline. A BEOVB is usually a good indication of weakness in a stock, although you should always look for other supporting factors like Fibonacci levels, Price Extension levels or other major support or resistance points.

The transactions for last week were: Read more…

Back again from our short break and it is good to see that the stock market didn’t do anything silly whilst I was away. The Australian market finished the week higher than two weeks ago when I wrote the last post. As I mentioned there it is still not performing as well as some of its global counterparts like the US or German stock market. Let’s hope we are getting a strong finish to year and bring the portfolio back up to a double digit profit.

We didn’t have any stops triggered whilst I was on the road and I haven’t checked if there were any new buys that we missed last week. However I have added to my position in PDN (Paladin Energy Ltd) on Monday. PDN is more than 15% percent in profit and the last swing down was less than 50% of the previous swing showing strength.

There will be some movement next week as I have identified one new buy. SGM (Sims Metal Management Limited) fulfils all the buy rules according to the HSC and I will add it to the portfolio. There are also a number of stocks that were a buy previously and either still are a buy or are a buy again. They are BOQ (below 12.06), MAP (below 3.12) and NWS.

Read more…

Finally on holidays in beautiful Chile. I am sitting in my in-laws office and look out over the Pacific Ocean on another beautiful but chilly (not Chile) day. The family is slowly recovering from a cold and tomorrow we are off to the snow to ski in the Andes. I’ll leave the computer behind and will be truly on holidays.

I still managed to have a look at the charts for this week and hope that I haven’t missed anything. I find it more challenging to only have the laptop screen, when you are used to have a big monitor at home. The markets haven’t moved much, we had some gains and losses and the portfolio edged marginally higher. With TEL (Telecom Corporation of New Zealand) and ERA (Energy Resources of Australia) we have added two more positions and now have 16 positions in the portfolio. We also closed our position in WDC (Westfield Group) and ended up break even.

The transactions for the week were:

Read more…

In midst of packing for our upcoming holiday, I managed to review the portfolio for the week. Again there wasn’t much movement in the portfolio, with the profit of our open positions declining due to two more additions (GPT and MGR) that finished the week lower. Just as I wanted to keep it short for the week, I have noticed quite a number of stocks that have given the buy signal for Monday and others that could be a potential buy during the week depending on the price development.

The buys according to my analysis are: TEL (Telecom Corporation of New Zealand) and ERA (Energy Resources of Australia). Following stocks need their monthly swing to point upwards in order to be a buy: SGM (Sims Metal Management Limited) 18.75 or higher, PRY (Primary Health Care) 3.79 or higher and TOL (Toll Holding Ltd) 6.14 or higher. PRY looks particular interesting with a double low for the dates 21st November 2008 (3.46) and 2nd July 2010 (3.45).

I also have a sell for the portfolio. WDC (Westfield Group) had two closes under the uptrend band.

The transactions for last week were: Read more…

Another week of heavy losses with many stops being activated. The XJO has now retraced by about 45% of the recent rise, which started in March 2009. And it looks like the market will at least take a breather on Monday with the US markets pointing higher on Friday. As mentioned in an earlier entry, this is quite normal at the end of a bigger cycle where you expect the market to retrace between 38% and 62%.

What looked like a quiet week in regards of selling and buying for the portfolio ended up to be a hectic week with a total of 4 stops being activated. We have been stopped out of WPL (Woodside Petroleum Ltd), WAN (West Australia Newspaper), SGM (Sims Metal Management) and NAB (National Australia Bank). There was also NWS (News Corporation), where we sold the remaining half on Monday as the stock had two closes below the trend band. Sorry it slipped through when I did the update last week, but when I looked at the chart again on Sunday I realised  we had two closes below the trend band.

The transactions for last week were:

17th May: Sell 304 NWS @ 18.50 for a total profit of 11.84%
21th May: Sell 373 NAB @ 23.93 for a total loss of 10.64%
21th May: Sell 443 SGM @ 19.17 for a total loss of 14.98%
21th May: Sell 1282 WAN @ 6.77 for a total loss of 13.02%
21th May: Sell 213 WPL @ 41.09 for a total loss of 12.59%

This reduces the portfolio size to 7 stocks with one being in profit and the others currently in the red. It also impacted the return on the closed positions which came down to 16.94%, whilst the current open positions sit at -2.55%. Still not bad considering that the market should turn around in the near future. There will be plenty of opportunities to buy and make good profits.

There are no buys or sells for next week however I have a couple of stocks on the sell watch list as they had one close below the trend band this week. They are: AMC, CCL, CEY, ORI and WDC.

Read more…