I’m waiting for a market signal

EVERYTHING continues to line up for our market to break the January highs and the first positive sign is the SPI futures broke above the January high on Friday of last week and has continued to trade around that level.

The All Ords and the S&P&ASX 200 however, remained below the January high as of Wednesday.

So we have a lot of positives indicating the market wants to go higher and a divergence between the indices and the SPI telling me we may see a small pullback or more sideways consolidation before the trend to the upside continues.

Bass Metals (BSM) continued to trade sideways for the past week, but on Wednesday it put its head above 3c for the first time in a while and the volume was the highest it has been in a month, so it is possible we may see it begin moving towards its next immediate target around 5c.

Now to the stocks discussed last week.

Panoramic Resources (PAN) moved up as expected, but on Monday this week it touched its March high and promptly fell away and on Wednesday its fall was arrested at the lower end of the recent sideways trading range.

If it rebounds from here it may now have to do some more work before it has the momentum to break above the March high.

I will watch it closely as it and the market consolidate.

Paradigm Biopharmaceuticals (PAR) behaved in a similar manner as it moved up to test the high it formed in September last year.

It fell sharply on Tuesday after testing the 50c level for two days.

It did recover a little on Wednesday but on very low volume so I might have to wait a day or two for it to signal a move to the next resistance level around 70c.

SRG Ltd (SRG) is consolidating around the $2 mark.

It fell last Friday and then recovered on Monday on a big volume increase, then pretty much went to sleep on Tuesday and Wednesday, but a move to around $2.50 is likely.

A daily close above $2 on increased volume should see it on its way.

Ramelius Resources (RMS) came back to test 60c after breaking above it a week ago and should form a buy pattern in the next few days.

Saracen Minerals (SAR) like the other stocks noted, fell back on Thursday last week and when it resumes the move up it has a target around $2.50–$2.80.

There are quite a few other stocks setting up in a similar manner and seem to be mirroring the index waiting to see when to move higher.

Last week I discussed the halfway signal formed in the chart for Titomic Ltd (TTT).

This daily pattern forms after a move up from a base when the price opens and closes for the day at the same level, with a high and low pretty much an equal distance above and below the open/ close.

It should form above the range of the previous day and the open the next day should be near the top of the cross.

The target is the price difference between the bottom of the recent pattern added to the closing price of the cross.

PORTFOLIO POSITION

Cash ........................ $380,582 Shares ....................... $19,800 Total ....................... $400,382

Starting capital of $50,000 in July 2006.