Sunday, August 29, 2004

Australian All Ordinaries Index (XAO) for week beginning August 30, 2004

The All Ordinaries index certainly didn’t decline this last week. In fact, it produced one on the biggest weekly rises for some time and just taking out the all time high. This indicates that August 16, 2004 was the “Half Primary Cycle” low.

The market is now entering week 15 of its 19-week “Primary Cycle”. It has confirmed a ‘right translation’ (making a new high after the midpoint of the cycle) indicating a bull cycle. The ‘one-day countertrend’ on Wednesday August 25 was another strong bull signal. If I were long in the index and it continues to rise, I’d be keeping my stops just under the daily swing lows as the market enters the Primary Cycle orb period on September 7.

Watch for strong resistance at 3596.

Based on turning dates, I expect the market to turn down on Tuesday and back up Friday. Someone ask me how I worked out turning dates … here is an example for this week!

I use “Geocosmic Analysis” as taught in the Advanced Trading Techniques course. For example:

Saturday Aug 28 - Sun opposite Uranus;
Monday Aug 30 - Full Moon;
Tuesday Aug 31 - Pluto Direct;
Wednesday Sep 1 - Mercury Conjunct Saturn.

That should turn the market in the middle of the cluster which is Monday afternoon-Tuesday (30-31/8).

Looking a little further ahead:

Thursday Sep 2 - Venus Sextile Jupiter 6:20pm;
- Mercury goes Direct at 11:14pm;
Friday Sep 3 - Time by Degrees.

Market should turn Friday.


Expect Monday, Tuesday and Friday to be large ranging day. At last we will be out of the Mercury retrograde period on Friday so making money will be easier!!!

Timing with planets sounds all a bit crazy? It just might surprise you!


A few stocks to look at:

CML – check out the triple top on Coles Myer: Feb 1999 @ $9.22; Aug 1999 @ $9.25 and Jul 2004 @ $9.18.

AMC – two consecutives closes above a valid down trend line.

MAY – opportunity space after a lengthy sideways movement.

Sunday, August 22, 2004

Australian All Ordinaries Index (XAO) for week beginning August 23, 2004

I mentioned last week that I thought that the marketing would reverse on Wednesday … it reversed on Tuesday and rose up through until Friday.

I am still cautious about the market moving into a decline. Currently the All Ordinaries index is making lower swing tops and lower swing bottoms; also it has broken below the 3489 level which now means to change my bearish bias it would have to break above 3572.5. The resistance levels for the rise are 3510 and 3526.

This Monday, August 23 is a reversal day; I expect the All Ords to turn down and decline through at least until Thursday.

Someone asked me this week what this report means to their analysis of shares. NOTHING!!! Just because the All Ords is expected to go down it doesn’t mean that all stocks will.

Check out AMC, MAY and CML, see if you notice certain market action on each of these stocks … I’ll write about them next week.

Monday, August 16, 2004

Australian All Ordinaries Index (XAO) for week beginning August 16, 2004

What an interesting week just gone! My bias last week was that the market would head back up and eventually make new all time highs. It never! I also mentioned in my report last week “If the index falls below 3489 watch out!” Now I need to explain why I said this:

The All Ordinaries has a “Primary Cycle” of 19 weeks with a tolerance of plus and minus 1.5 weeks. This means over 70% of the time the index makes a significant decline or trough between week 16 and week 22 from its previous Primary Cycle low. From the study of cycles we also know that if the cycle is to remain bullish (end higher than it started) then it must make higher peaks in the second half of the cycle and it rarely goes lower than the very beginning of the cycle. The beginning of this 19-week cycle started May 18, 2004 at 3346.8, and it rose to its peak on August 3 at 3572.5, 11 weeks and 225 points from the beginning.

This could still be a ‘centre translation’ cycle (the highest peak happens in the centre of the cycle troughs, between weeks 9 and 11) indicating the possibility of a double bottom around 3346, certainly not a short term bullish sign.

Another reason I mentioned that if the index falls below 3489 watch out, was that the All Ordinaries index is now in the period for a decline to the "20.5-month cycle" trough! The 20.5 month cycle began March 13, 2003 at 2666.3 therefore this trough will fall between August 6, 2004 to February 28, 2005 with the low expected between 3012 and 3226 with major support at 3119. That is a minimum decline of 346 points.

As “Advanced” Students know, the one day counter trend last Thursday confirmed the high on August 3, 2004 (a time-by-degree turning date) giving the confirmation to short the market. Breaking of the 50% support level of the Primary Cycle at 3460 would indicate further weakness.

The outlook for this week is decline until Wednesday, August 18. Wednesday is a strong reversal date with all time indicators pointing for a sharp reversal; which means a change in direction which ever way the index is going.

As mentioned last week, expect the market to be more volatile and less predictable and trader’s analysis skills to be distorted. If you do trade this period from August 10 – September 2, be nimble …. Take profits often and early.

Sunday, August 08, 2004

Australian All Ordinaries Index (XAO) for week beginning August 9, 2004

Last week the All Ordinaries did exactly what as predicted. I wrote last week “the All Ords will continue to rise this week with average to strong moves Tuesday, Wednesday and Thursday. Thursday August 5 is a strong turning date for the market so if the market is moving strongly up then a reversal Thursday will see a counter trend down until Monday, August 9.” Monday, August 2 the market didn’t do much, Tuesday was a large range day as was Thursday. The market rose up at the beginning of the week and then turned down Thursday and continued its fall Friday as I suggested it would. What will it do this week?

I expect this week to be volatile and difficult to trade with very short term trading opportunities. My bias is that the All Ords will open low on Monday and trade up at least until Wednesday. Current support is at 3510 and 3489. Key turning date this week is Monday.

The All Ords index is entering week 12 of its 19-week Primary cycle and to see the current Bull Run to continue it is important that the market rises this week and makes new all time highs late this week early next week. If the index falls below 3489 watch out! This market will have a big fall (this is not my bias, but anything is possible.)

A word of warning for short term traders - the market will become more volatile and less predictable, and traders analysis skills 'will tend to be distorted. The message from this is if you do trade this period from August 10 – September 2 , be nimble …. Take profits often and early.

Sunday, August 01, 2004

Australian All Ordinaries Index (XAO) for week beginning August 2, 2004

Welcome to my first report on the Australian All Ordinaries Index for 2004. I used to write a report nearly six years ago for ODDS, a web based online data provider, also for the Money Section of the Melbourne Herald Sun daily newspaper. Because of the accuracy of the report I have had many requests since to publish a regular report on the All Ords. The purpose of this report is to provide a view of my bias on the Australian market at least a week in advance and at the same time educate you with analysis methodologies. So here goes …. happy reading!

The All Ords index is entering week 11 of its 19-week Primary cycle; the cycle started at 3346.8 on May 18, 2004, rose to make a Half Primary cycle peak at 3563.1 on July 12, 2004 and fell to 3488.9 on July 26, 2004 (last Monday) to make the Half Primary cycle trough (yet to be confirmed). The first thrust up of this two thrust bull cycle was 216.3 points! [Note: For those who have studied Gann, this cycle is humming along to the natural number of 144 (square of 12) … 216 point rise (150% of 144) and 74 point decline (50% of 144 is 72). Could be a coincidence!?!]

The All Ords had a good rise last week (July 26–30) making up most of the decline from the previous two weeks. This rise was expected as the index is coming off the Half Primary cycle low of 3488.9 on July 26. So where to this week?

I have an overall (next 12-18 months) strong bullish bias for the Australian All Ordinaries Index for a number of reasons of which I will discuss over the coming weeks and months. Be aware that the 20.5-month cycle low is due between August 8, 2004 and February 27, 2005. That said my short term bias is that the market is bullish. As the index is in week 11 of its 19-week cycle, and the first thrust was strong right translation, I expect the All Ords to rise for the next 3-4 weeks at least. The only thing that would change this is if the XAO fails to take out the 3563.1 high made on July 12, 2004 within the next three weeks which would put the market in a dive for the 20.5-month cycle low somewhere between 3008.8 and 3220.5.

My bias is that the All Ords will continue to rise this week with average to strong moves Tuesday, Wednesday and Thursday. Thursday August 5 is a strong turning date for the market so if the market is moving strongly up then a reversal Thursday will see a counter trend down until Monday, August 9. [Note: If the market turned down on Monday, August 2 (which in my view is unlikely) be prepared for the fall to continue through until Thursday and hence this cycle to be center translation, turn bear and head for the 20.5-month cycle low.]

Watch minor price resistance (intraday) at 3561, medium resistance at 3592 - 3597, minor resistance again at 3633, 3651 and 3658, and strong price resistance at 3705, and extreme resistance at 3724.3.

Happy Trading … and remember …

... “Only go long in the first 1/6th of the Primary, Half Primary and Major (6-week) cycles!”