Here we have a triangle. Now this was really a difficult thing as it happened.

Triangles are normally a continuation pattern. So one could expect a continued move down. We were discussing just this scenario in our advanced charting class Sat Oct. 9th. Which way would it break? On Monday as it turned out, we broke upwards. As I write, we are now breaking downwards. It's really tough when the market does that. Especially trying to trade it. (I was expecting a move back to 3000 before the next larger move down.) A bear market is looming.

Something to watch.
Trading over the past month has been really something to behold. Things are happening so quickly. I watch the market as close as I can, and its even been too quick for me. Have a look at Cluff resources, the ERG latest spike, Liberty one, Davnet to name a few. Panic buying? The influence of chat rooms? The speed of the internet? Is this the way of the future? To me, and I say this again, the market is showing all the signs of the final stages of a major bull run. I might be wrong but....

Here's something out of left field. In 1929 the crash occurred 55 days after the peak Sept 3 high, (+55 days = Oct 28, 29th being the worst day). I am counting 55 days after Aug 25th Dow high = 19th Oct - that's Tuesday. Just something to watch in light of latest run down. (This is not a forecast for a crash, just an interesting thing to watch. Will probably pass as nothing, but it is October after all).

Several stocks have just gone into the All Ords index, which now means index funds will have to re-weight their index tracking portfolios to reflect this fact. The stocks are Ecorp, Powertel, Sausage, and Solution 6. Buying pressure will continue on these stocks for about the next 30 days. (Already visible in the charts since Oct 1st).

Just one additional point;
I just cannot see why anyone would want to buy anything at present. but I shall review all the charts for more learning exercises and then post them up next week. I am just back from 2 weeks in Singapore so I'm catching up. Early October most years is not usually a buying time.

Talk.

I am presenting at the next Australian Shareholders Association meeting, Oct 21 (Thursday) at Bells Hotel Sth Melbourne. (Moray street near Coventry St).

My talk will be on the business cycle. They're expecting 85 - 125 in attendance, so it should be a great evening.