Signs point to new highs
THE All Ords, the ASX/S&P 200 and the SPI futures contract have all broken the downtrend formed since January this year and are consolidating just below the January high.
The consolidation may continue a few more days as I expect the market to have a small pullback from this level.
There were a couple of reversal days over the past week and on Wednesday there was a divergence between the All Ords and the ASX/S&P 200 when the All Ords traded above Tuesday’s high and the ASX/ S&P 200 failed to trade higher, indicating a potential fall, so I would expect the market to have traded lower yesterday at least.
However, it all looks to me that we are setting up for the next leg up in the market to take it towards the 2007 all-time high.
In the meantime, Bass Metals (BSM) has not woken up and is still trading sideways on low volume.
On Wednesday, it did close down point one of a cent lower for the week, so we are now perilously close to the portfolio value slipping below the $400,000 mark.
Big Un (BIG) is still suspended and continues to look like it may be a total loss, but I will continue to include it in the portfolio position until it is either reinstated or delisted.
There are a number of stocks I have been watching, so I will discuss some of them and in no particular order.
The first one is Panoramic Resources (PAN).
After jumping from 48c to 52c in April, it has traded sideways between 52c and 54c since then. It moved up above 52c on Wednesday on a big volume increase, but formed a reversal candle in the process, so it might be a false break.
Yesterday and today should clarify if it is indeed a false break.
Paradigm Biopharmaceuticals (PAR) has formed a great consolidation pattern since September last year and been testing the 45c highs of that pattern during the past month.
Last week it had a slow pullback to 40c, then formed a daily pivot point to the upside on Tuesday on increased volume.
If it now breaks above 45c and has a small pullback, it will be a likely candidate to trade.
SRG Ltd (SRG), after trading sideways below $1 since 2008, moved up to near $2 in late 2016.
It has formed a classic cupand-handle pattern on the weekly chart since then.
On Wednesday it traded briefly above $2 intraday – the level it was at before the big fall in 2008.
If it consolidates at this level it too should present me with a trading opportunity.
Several gold stocks have also moved recently.
Ramelius Resources ran up this week to break above the spike high it formed in April last year and might present a buying opportunity soon.
Saracen Minerals (SAR) has recently moved back above its 2016 high of $1.80, after falling back to 80c at the end of 2016.
Titomic Ltd (TTT) formed a halfway candle (a cross above the previous close) on Tuesday, indicating a target around $2.50.
PORTFOLIO POSITION
Cash ....................... $380,582 Shares ...................... $19,500 Total ...................... $400,082
Starting capital of $50,000 in July 2006.
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