Hi Toastie and Rav (and mel) (and perhaps
@gj0201 might also like to join in this question, I know he likes this sort of stuff)
I don't know if a
medium term or
substantial high is in.
For me, the charts say a 'daily' or 'near term' high is most likely in for sure.
Firstly - I am generally optimistic, and usually lean towards the positive side of market movements.
Which is broadly a good thing, as downtrends are usually completed over a shorter time, when compared to uptrends which generally last much longer. So I am always looking for the end to downtrends, and always expect uptrends will be ongoing for longer.
My own gut feeling is that the US economy is in pretty good shape overall, and continues to do well.
I feel the recent weakness has emerged because the US Fed is beginning to unwind the decades long stimulus package it has been providing the economy since the GFC, and at the same time is also increasing interest rates (as they should).
I see both of these measures as necessary and the right thing to do (they probably should have started much sooner actually).
In response to these economic measures the US professionals will use the uncertainty they are able to create (via the media and the markets) to their own advantage. So if the news media is generally bad and unsettling (which it has been so far) I expect the professional traders will be helping to create some market havoc, by quickly ramming prices lower, creating a short term panic, most probably so they can reload at some point in time, and then once again ride the strong US economy higher.
Opposing this - if the media and market commentary was attempting to calm the markets, I would be much more concerned for ongoing downside.
I could easily be wrong here, and to some extent the situation is fluid and can change from one sentiment to another as time goes on, but that is my thoughts at the current time.
cheers
(20min delay)
