I read with interest Jordan’s article before I wrote my editorial and coincidentally it was a subject about which I planned to write but from a different perspective.
I must say I find it irritating to hear news readers – especially on morning TV shows which are watched (and believed) by millions of viewers – say our market is going to fall by a certain amount that day. They are extrapolating from the USA markets and so often are just plain wrong. And they say it with such great authority in their voice. I can also recall one high profile Economist from a major bank who also pronounces - equally with great authority.
As I write, our market is down 17 points after the DOW was up by 92 points. I have a view however that we are going into a short term of divergence – or incongruence. I believe the DOW is going to be benign in style for the short term – range trading if you will.
But I have the view our market is going to head lower:
click to enlarge
It is unusual to see this but it does happen. And I look for some fundamental explanation but I can’t find it.
But I have enough faith in the technicals – especially Elliott to at least take head. It is enough to keep me away from long positions until the scenario unfolds.
Why take the risk?
Enjoy the ride