Current Outlook 18/03/09
by, 19th-March-2009 at 12:19 AM (3760 Views)
While I'm a bit bullish atm on the outlook of the overall market, it is important to keep my eyes open and trade what is in front of me.
CBA had 1/2 the profit locked in today due to it running so hard so quickly. Because of my tight stop on entry I was carrying a larger than normal position size and was able to do this. I will now give the tade a bit of room and see what happens - I could give back a fair bit of profit here but.... - Prices back under $30 are a serious red flag.
NAB will have the stop moved up to either yesterdays low or todays low depending on how the US plays out tonight but if there is any strength left in this stock it shouldn't probe under todays low and definately not yesterdays low - depends on how much profit I want to give back.
NCM & CSL trades look like fizzers and fair chance of being stopped out of both tomorrow.
I'm starting to find a few short set ups that I like and will have a few orders pending for tomorrow.
The next leg down will now tell us a lot about this current strength in the market and whether it is a sustainable larger bounce or a short term bulltrap bounce.
I have attached 2 charts with a possible set up that could play out - the first chart is NAB which has a completed pattern on it (this was the pattern I traded with my current NAB trade) and the second chart is the XAO. This pattern could be invalidated tomorrow or next week but until that happens it is my favoured outlook.
Other possiblities are:
- Shoot straight through 3500 before a retrace, unlikely imo
- Retrace to 3200 where support comes in forming a higher low and then shooting up through 3500.
- Heads straight down towards 2800
All of the above scenarios will provide some good trades as long as you can get on the right side of the trade
And of course the market could do a million other things.
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