Monday, May 28, 2012

All day sucker

It looks like one of those markets which is going to push up to the close and would be typical of a day when there's no US trading to come overnight. It often seems as if one day's trade is stretched out to two so that a typical situation where an early short covering rally fades into the close is played out at a more leisurely pace. I have a couple of gold longs which have rallied well but my shorts are also up so it's a negative day overall.

Weekend polls from Greece show the incumbents back in the lead and this has helped sentiment along with more noise about a common Eurobond. However, the only concrete development on the weekend is the need for a Spanish government bail out of Bankia SA to the tune of EUR 19 billion.

The Asx 200 daily chart, below, is recovering after a fractional new low on Friday. It's a common reversal set up so despite my scepticism about Europe, I'm wary of getting caught out.

chart

4.14 As per the script, the market kept pushing and some of the laggards had strong catch up rallies in the order of 5 to 10% with LYC winning the prize with a rally of 18% to 105.5. I'm disappointed to have missed out but it was patchy and I picked the wrong horses this morning. As posted earlier, this could continue to rally but I'm treating it as a one day wonder for now.

The Asx 200 closed up 39 to 4068, the high was 4071.

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