This is an important point in the life of the recent rally seen in the stock market. As the chart above details, we have made the 'technical' bounce off the extreme low seen in July (that was the easy part). For this bottom to be real, we will now have to see if the recent lows can hold during a serious retest. At best we may establish a nice consolidation for the next few weeks in an around these levels. My hunch though (considering the rhetoric coming out of Moscow and the poor economic data from across the world) is we will retest the lows seen in July. On a final note, one ought to respect the fact that we are still very comfortably within a long term downward pointing channel. Where resistance to that trend is represented by the blue arrow in the chart above and support is represented by the red arrow.
Better get out that old Beta copy of Wolverines.......The Russians are coming, the Russians are coming!
That's all for this week,
Brian Beamish FCSI
the_rational_investor@yahoo.com
the-rational-investor.com
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