Trading Day Tuesday, 3rd May 2011

S&P/ASX200 Index

Midday Summary
The S&P/ASX 200 is down over 1%, or 51 points at 4773 at 1pm AEST, below support at 4800 points.

Momentum and other technical indicators are very negative as this broad selloff continues to hit all sectors.
Three consecutive closes below the 15 day moving average are indicative of a correction pattern, but medium
term momentum and cyclical indicators do not confirm a correction yet. The next support level is 4700 points,
but a correction could overshoot to 4500 points, particularly if the RBA applies the brakes and raises rates, thus
increasing the AUD (again) and pushing the industrials further into negative territory.

Eyes are still on the banks which report earnings this week, with ANZ reporting record profit but the stock falling
over 1%. This may bode ill for the other banks, with NAB in particular already overbought in the short term.

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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 Tuesday, 3rd 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 Sideways bullish AVOID Intraday buying support is growing and developing
into a possible new trend. Watch for breakout
above $14.60

AMP Limited AMP Sideways bullish AVOID Becoming oversold with some buying support -
down almost 1.5%. No entry signal here

ANZ Banking ANZ Sideways bullish AVOID Market not happy about earnings news, down over
1%, but still going sideways. Wait until other 3
report earnings to see how the financials react.

ASX Limited ASX Medium term BEARISH Still in “rounding top” bearish formation - down
downtrend almost 1%

BHP-Billiton BHP Sideways bullish HOLD Finding very strong support at $45.50 - down 1%

Bluescope Steel BSL Medium term BEARISH Up slightly on finding support, dangerous territory
downtrend, meeting here. Tighten stops to $1.80 or lower
support

Boral BLD Sideways bearish AVOID Still slipping - overall pattern is “head and
shoulders” - very limited upside potential

Caltex CTX Sideways bullish AVOID Found support at $14 - no further action yet

Coca-Cola Amatil CCL Medium term uptrend HOLD Down a little this morning, but still within a tentative
hitting resistance medium term trend. Good defensive stock IMO

Cochlear COH Medium term uptrend HOLD Found some support at $80 - not bad value at that
complete - sideways price, but no short term action yet

Commonwealth CBA Sideways bullish HOLD “Running out of puff” - keep waiting for earnings
Bank

CSL CSL Sideways volatile AVOID Finding support at up 0.6% - AUD dollar still
weighing on this Very Good company

CSR CSR Medium term BEARISH Steady - could see a “dead cat bounce” rally from
downtrend here - tighten stops to $3.00 even

David Jones DJS Sideways bullish AVOID Still tracking sideways, up a little this morning

Fairfax Media FXJ Medium term BEARISH Down 7% this morning on trading update - this
downtrend merits re-valuing as FXJ is at GFC lows....

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 Tuesday, 3rd May 2011

ASX100 Select (continued)

Name Code Pattern/Stance Position Notes

Fortescue Metals FMG Sideways bullish, AVOID Down lightly this morning, but some buyers
meeting resistance stepping in - overall pattern is still sideways

Harvey Norman HVN Medium term downtrend BEARISH Although down 0.7%, has been sideways for 3
days now. Tighten stops to $2.72 or cover half

JB Hi-Fi JBH Sideways bearish AVOID Up slightly, but cautious consumer meme
continues - upside potential will be squashed if
RBA raises rates. Avoid

Macquarie Group MQG Medium term downtrend, AVOID “Watch for breakout above 63 EMA” - just missed
hitting support it! Down today - no entry signal yet

Myer Holdings MYR Sideways bearish AVOID Up 1%, but nothing happening here - still in
bearish triangle pattern.

National Aust. NAB Sideways bullish HOLD Down 0.5%. Rally has gone on long enough - risk
Bank is growing of a reversal. Tighten stops

Newcrest Mining NCM Sideways bullish HOLD Still in holding pattern on gold volatility

Onesteel Ltd OST Medium term downtrend COVER “this ain’t over yet” yeah it is - up 3% on a bullish
reversal day - tighten stop to $2.20 but be
prepared for DCB

Oz Minerals OZL Sideways bearish AVOID No close below $1.40 yet - bouncing along like
the other resource stocks. Avoid

Qantas Airways QAN Medium term downtrend, AVOID Up 1.5%, sliding along a potential buy zone at
hitting support $2.10 - watch a fall in oil prices (but not AUD) for
a possible rally

QBE Insurance QBE Sideways bullish AVOID Down 1% - but still medium term bullish sideways

QR National QRN Sideways bullish AVOID 4% breakout yesterday has no follow up - wait

Rio Tinto Ltd RIO Sideways bullish HOLD Finding support at $82 - mimicking BHP

Suncorp Group SUN Sideways bearish AVOID Still bouncing - down almost 1%

Tabcorp TAH Medium term uptrend HOLD Up 0.8% lots of selling pressure above here

Telecom Corp. TEL Sideways bearish AVOID Ascending triangle pattern failed - down 0.3%

Telstra TLS Sideways bearish AVOID Up slightly - failed stage 2 rally - avoid for now

Wesfarmers WES Sideways bullish HOLD Down another 1%, but very slowly. Nothing to see

Westpac Bank WBC Sideways bullish HOLD Down almost 1% - wait on earnings

Woodside WPL Sideways bullish, trend HOLD Down almost 1% - watch for close below $46
stalling

WorleyParsons WOR Sideways bullish HOLD Change to bullish sideways - indicators suggest
end of trend

Woolworths WOW Sideways bearish AVOID Lots of buying support in last 3 days and up 0.4%
today against the broader market selloff. Watch

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ASX Small Ords

Name Code Pattern/Stance Position Notes

Acrux ACR Medium term uptrend BULLISH Down again - maintain stop at $3.35

Billabong BBG Medium term downtrend BEARISH Up slightly and decelerating - tighten stop to $6.85

Centro Retail CER Medium term uptrend, HOLD Still firming for possible upside breakout here -
meeting resistance watch the close for small initial position

Energy Resources ERA Medium term downtrend BEARISH Down another 5.6% - this is waaaaay oversold

Graincorp GNC Medium term uptrend BULLISH Up 0.5%, but probably sideways from here

Kingsgate Consol. KCN Medium term downtrend BEARISH Down 4% broke support

Matrix C & E MCE Sideways bearish BEARISH “Close below 63 EMA is ominous” - and keeps
falling, spooking investors.

1300 Smiles ONT Sideways bearish - BEARISH This Wonderful company is down 7% on very
broke through support illiquid trade - can’t short but you can buy at these
prices which are below value.

REA Group REA Medium term uptrend, HOLD Still firming for possible downside breakout here -
meeting resistance watch the close

Regis Resources RRL Sideways bullish AVOID “not much upside from here’ down almost 3%

Sedgman SDM Sideways bearish AVOID Down 2% this morning, but buyers have stepped
in - what is it with engineering services companies
at the moment?

Sigma Pharma. SIP Sideways bullish, short BULLISH Down 3% - but still in trend channel, although
term trend sideways - tighten to $0.35

Super Retail SUL Medium term uptrend HOLD “Breakout - Looks toppy at these prices” - what
would I know? Up 2% on a gap. Mmm

The Reject Shop TRS Medium term downtrend, AVOID Is $11 support for this Very Good Company?
finding support Getting towards good buy zone for investors only.

Whitehaven Coal WHC Short term downtrend - BEARISH Gapped down 3% today through support - this is
accelerating very fast. Tighten stops in ready for rebound.

Wotif.com WTF Medium term uptrend BULLISH Up 1% again - this volatile little Good Company is
back on trend. Stay the course

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 Tuesday, 3rd May 2011

Calendar

Date Event/Company Notes

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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