By the book

The index has weakened from a firmer start to be down 29 as we enter the last 10 minutes of normal trading. The possibility of a downtrend developing is becoming stronger as Monday's high looks increasingly like the 3rd lower high below resistance in recent weeks.

I'm out of my short position in IPL, prematurely, because I noticed that it goes ex dividend tomorrow and I didn't want to be short the dividend. Bought back at 331 versus an entry of 347. I'm also out of the last of my long position in IAU on a trailing stop.

I'm looking at one potential long into the close of trade and a couple of shorts. The long is in BLD with exposure to the building cycle in Australia – rates coming down – and the US where the economy is surprising to the upside, albeit in a modest way.

I'm late into Boral but it has confirmed a buy signal with trades at 370 to provide another entry signal and is closing reasonably well in a soft market so I'll buy on close provided the level is roughly where it's at now.

FMG is one of the potential shorts. It was a possible long yesterday but I ruled it out for being in a pennant which could break either way but was more likely to break to the downside given the weakness of the recovery so far. I thought I'd made a mistake early when it pushed above 500 but that strength faded quickly.

 

AWC and OST are also on the shorting radar.

4.14 The index closed down 38 points. I dealt in all the stocks I just mentioned. OST was sold into the match and fell below the 100 level, which had provided support for the last 3 sessions, to close at 99.5. My stop is at 105.