This could be an expensive lesson

THE All Ords, ASX 200 and the SPI futures contracts all had a relatively calm week last week – with all ending the week slightly higher than the week before – and the SPI was still trading at a premium to the ASX 200, indicating all was looking good.

However, all three closed on Wednesday slightly lower than last week’s respective lows. The SPI still remained several points above the ASX 200, indicating to me the market was still positive.

The only stock in the portfolio that closed higher on Wednesday than the previous week was Aeon Metals (AML).

Australian Mines (AUZ) was square for the week.

The balances were all lower and some still below their listed stop levels.

I am still holding most stocks despite some having broken their stops, as I am still working on how I want to place stops when stocks have moved in a transitioning market and volatility causes quite large moves both up and down.

If it turns out the stocks in question do not recover, it will be an expensive lesson and teach me to take profit in all cases when targets are reached – even if higher targets are predicted after consolidation.

The three stocks I noted as being watched last week are still in play, but I have not bought them as yet as two of them have pulled back with the rest of the stocks I am holding.

But I will look to buy if they reverse the slow pullback and form pivot point buy signals before breaking support.

Rimfire Resources (RIM) is the only one to have moved up from its recent low, but will need to close above 3c for a daily pivot point to form.

I will try to explain why and where some stocks that are held will likely reverse the recent moves down from their recent highs.

The A2 Milk Company (A2M) has been slowly moving back from its $8.05 high on reduced volume for the past two weeks, and I am expecting it to begin the next move up before it reaches its strong support around $7. It might have reversed on Wednesday and if that was the case then it should be confirmed by today.

Big Un (BIG) has pulled back from the strong move up on November 29 and it too may have reversed that pullback. That also should be confirmed by today.

Queensland Bauxite (QBL) had a big move up to 9.7c over the past week and reversed on Tuesday before closing on Wednesday at 7c.

It seems to have found support around 6.5c, where it reversed on Wednesday, and if this is the case then I expect the next move should see it reach its next target around 13c.

The recent spike low of 35.5c will be the critical level for Altura Mining (AJM).

A break of that level would likely see it fall to the next support at 30c.

Artemis Resources (ARV) was sold yesterday after it broke below 27.5c.

Past columns, information and DVDs on my methods are available at theday.trader@news.com.au