Trading Day Monday, 2nd May 2011

S&P/ASX200 Index

Midday Summary
The market is continuing a broad selloff, as the major constituents across all sectors are down after midday.
The ASX200 is down almost 0.75% and is teetering below support at 4800 points.

Momentum and other technical indicators are negative but not conclusive of a broad correction as this is likely
to be a dip that will turn into stagnation coming into the end of the financial year. Eyes are on the banks which
report earnings this week (CBA early next week - see calendar at end of report).

Some small caps are approaching value again after exuberant bids of the last couple of months. But are we
seeing “sell in May and go away” in action?

Chart 1. Daily candlestick with 15 and 260 day moving average (pink/blue lines)

ABOUT DISCLAIMER
The Prince is a full The content of this document should not be taken as investment advice or construed as a
time trader with recommendation to buy or sell any security or financial instrument, or to participate in any
extensive experience particular trading or investment strategy. The views expressed are the opinion of the author
in equities and only. The author may have a position in any of the securities mentioned. Any action that you
derivatives trading take as a result of information or analysis is ultimately your responsibility. Consult someone
and portfolio who claims to have a qualification before making any investment decisions.
management.

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 Monday, 2nd May 2011

Daily Stock Scan

How to read What does “position” mean?

These watchlists are the results of end-of-week Bullish = looking to add/start long position
scans, using a medium term trading system to Bearish = looking to add/start short position
ascertain the strength, direction and momentum of Hold = maintained current position
trends.
Avoid = wait for direction/catalyst
This intra-day report will pinpoint possible entries
Go to the glossary at the end of the report for more
and exits based on a short term trading system.
information.

ASX100 Select

Name Code Pattern/Stance Position Notes

AGL Energy AGK Medium term downtrend AVOID Down 1%, still sideways

AMP Limited AMP Sideways bullish AVOID Short term downtrend support at $5.30

ANZ Banking ANZ Sideways bullish AVOID Down 0.5%, sideways waiting for earnings

ASX Limited ASX Medium term downtrend BEARISH Down 1%, int’l hate of Oz stocks amplified
through ASX

BHP-Billiton BHP Sideways bullish HOLD Close below 63 EMA on Friday could bring
in swing traders - down 8% in 2 weeks

Bluescope Steel BSL Medium term downtrend, BEARISH Down another 2.5% - no support
meeting support whatsoever for BSL. Tighten stop to $1.82

Boral BLD Sideways bearish AVOID Breakout below support, down almost 3% -
downgrade to sideways bearish and short

Coca-Cola Amatil CCL Medium term uptrend HOLD “Watch the close” - so did everyone else,
hitting resistance down 2%, stopped out. Bugger

Commonwealth Bank CBA Sideways bullish BULLISH Running out of puff - waiting for earnings
next week. Take half profits.

CSR CSR Medium term downtrend BEARISH Down another 1.3% tighten stops to $3.09

Fortescue Metals FMG Sideways bullish, meeting AVOID Broke through support at $6.20, may find
resistance buyers at $5.70. Down over 2% so far

Harvey Norman HVN Medium term downtrend BEARISH Down another 0.8%

JB Hi-Fi JBH Sideways bearish AVOID Down 3% on Friday, another 1.4% this
morning. Short term short on the cards

Macquarie Group MQG Medium term downtrend, AVOID Monkey bottom pickers stepping in - will
hitting support MQG become a boring or exciting bank
again? Watch for breakout above 63 EMA

National Aust. Bank NAB Sideways bullish, trend BULLISH Pausing with some spinning top candles -
developing waiting on earnings like everyone else.
Take half profits if haven’t done so...

Newcrest Mining NCM Medium term uptrend, HOLD “Hold here for a bit” - support at $40.50
pausing

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 Monday, 2nd May 2011

ASX100 Select (continued)

Name Code Pattern/Stance Position Notes

Onesteel Ltd OST Medium term downtrend BEARISH “this ain’t over yet” - down almost 2%,
tighten stop to $2.23

Oz Minerals OZL Sideways bearish AVOID Possible downgrade to BEARISH,

confirmed when closes below $1.40

Qantas Airways QAN Medium term downtrend, AVOID ”possible short action here” - down 0.5%,
hitting support but support is strong with this one

QR National QRN Sideways bullish AVOID Possible breakout here - up 2.6%

Telecom Corp. TEL Sideways bearish, breakout AVOID Ascending triangle pattern almost complete
not confirmed - watch for new breakout above $1.62

Telstra TLS Sideways bearish AVOID “overbought” - yep down 0.7%, but this
might have legs - medium term trend?

Wesfarmers WES Sideways bullish, trend HOLD Slipping again. Better finds elsewhere
developing

Westpac Bank WBC Sideways bullish HOLD “Tighten stops” - indeed, unlike its brethren,
WBC is falling before earnings - overbought

Woodside WPL Sideways bullish, trend HOLD Watch for close below $46 for possible
stalling short term short

WorleyParsons WOR Medium term uptrend, HOLD “stay the course” - but watch that close:
complete? secondary indicators suggest end of trend

Woolworths WOW Sideways bearish AVOID Still slipping, down 0.6% - good buying for
investors here

ASX Small Ords

Name Code Pattern/Stance Position Notes

Aditya Birla ABY Medium term uptrend, HOLD “take profits” - reversal today, down 9%. You did
pausing take profits yes?

Acrux ACR Medium term uptrend BULLISH Down slightly - tighten stop to $3.35

Billabong BBG Medium term downtrend, BEARISH Still dropping as the AUD goes through $1.10, got
accelerating to find support soon at these prices

Bandanna Energy BND Medium term uptrend, HOLD “take half or all profits and tighten stops” - topping
complete out seems complete here

Beach Energy BPT Medium term uptrend, HOLD “but nothing short term” - well I got that completely
pausing wrong, down 4% today

Data#3 Ltd DTL Sideways bullish HOLD Closed down almost 3% on Friday, down another
1.6% today. Support at $13?

Emeco Holdings EHL Sideways bullish - AVOID Down almost 2% on Friday, and again today.
medium term trend over Medium term trend well over.

Envestra ENV Medium term uptrend, AVOID Strong intraday selling, looks topped out. Cover
complete and stand aside.

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 Monday, 2nd May 2011

ASX Small Ords (continued)

Name Code Pattern/Stance Position Notes

Energy Resources ERA Medium term downtrend BEARISH Down another 2% - who knows how low it can go?

Flexigroup FXL Medium term uptrend BULLISH “Take profits” - too soon, still within trend channel

Forge Group FGE Sideways bearish AVOID “End of trend” down 2.5%. Avoid.

Graincorp GNC Medium term uptrend HOLD Steady, but probably sideways from here

Lynas Corp LYC Medium term uptrend, HOLD Very fast retracement, down to $2.00 again, but
meeting resistance watch for buyers on this dip before starting a short

Matrix C & E MCE Medium term uptrend AVOID Topping pattern complete - investors rush to the
complete, sideways exits. Close below 63 EMA is ominous.

Medusa Mining MML Medium term uptrend, BULLISH Strong resistance at $8.40, but still within trend
accelerating channel. Maintain stop at $7.80

Regis Resources RRL Sideways bullish AVOID Stopped out - reverting to sideways bullish, not
much upside from here.

Sedgman SDM Sideways bearish AVOID Down 4% this morning, short term downtrend
underway with support/target at $1.70

Seek Ltd SEK Sideways bearish, AVOID Reverting to mean again at $6.80 point of control.
possible breakout Short term uptrend is well over.

Sigma Pharma. SIP Sideways bullish, short BULLISH Up almost 3% on good bids, after a shakeout
term trend

Super Retail SUL Medium term uptrend, HOLD Breakout, but meeting resistance - up 1.5%. Looks
meeting resistance toppy at these prices.

The Reject Shop TRS Medium term downtrend, COVER Still no support for this Very Good Company.
finding support Getting towards good buy zone for investors only.

Virgin Blue VBA Medium term downtrend, COVER Down again, now at historical support - will likely
finding support rebound if the AUD falls. Yeah right.

Whitehaven Coal WHC Sideways bearish, AVOID Short term downtrend underway, down 3% today
possible reversal and hitting long term support.

Wotif.com WTF Medium term uptrend BULLISH Down almost 3% today, which isnt unusual for this
volatile stock, but just on trendline - watch this at
the close.

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 Monday, 2nd May 2011

Calendar

Date Event/Company Notes

Monday, 2nd May ABS House prices, commodity prices

Tuesday, 3rd May RBA Cash rate/RBA rate statement

Tuesday, 3rd May ANZ Earnings

Wednesday, 4th May WBC, CCL Earnings/Update

Thursday, 5th May ABS Building approvals, Retail Sales

Thursday, 5th May NAB Earnings

Friday, 6th May USA Unemployment rate

Tuesday, 10th May Commonwealth Bank (CBA) March QTR Trading update

For more up to date information on upcoming events go here.

Glossary of Terms

Term Description

Bullish Biased towards an uptrend in the stock, either trend continuing or a new trend to develop

Bearish Biased towards a downtrend in a stock, or lack of potential for growth, or to add to a short

Long/Short The buying/selling of a security (or derivative thereof) with expectation it will rise/fall in value

Sideways Usually with a bullish/bearish bias, the stock is consolidating and not moving in a medium
term basis, but may move in between a channel of prices through short term trends.

Hold To maintain the position and examine risk management (e.g tighten stops)

Avoid To avoid a position entirely, but not to stop watching for future potential

Resistance An upper price level that a stock or index can trade to, but not exceed.

Support A lower price level that a stock or index can trade down to, but not drop below.

Momentum The rate of change or acceleration of prices, either upwards or downwards.

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