Summary for Week Ending 17th May 2003

The markets this week yet again displayed the remarkable ability to shrug off what should have been a negative sentiment and look towards the possibility of the rosy future. Just exactly where and when this wonderful world will appear is yet to be acknowledged, however it is a reasonable assumption that the markets do not generally take disappointment well, and so perhaps what we are seeing now i the market setting itself up for a large disappointment... but only if we don't see the turnaround in fortunes that everyone appears to be wishing for.

Looking at the action this week, again we we saw a sharp rise early in the week with the following days spent consolidating this movement. Overall we were up for the week, but we could have shut down on Monday and achieved the same result. Looking at the DJIA and S&P chart, this pattern has been reflected in the past few weeks so it comes as no surprise. The movement is constant and consistent, and there has been nothing to indicate that this behavior will change. There have been no dips below previous swing lows and upswings have generally been higher than the previous. Of note of course, as I have been saying for some time now, there has been no clear swing movement and the markets are still getting in their own way. I would presume that when we do finally get a swing low that clears the previous swing high, at this late stage in the cycle, I would be expecting that we would be nearer to the end than the beginning. Patterns such as the one described are great when they happen early, but I am less inclined to trust them when they appear well after the trend is in place.


Looking forward into next week, I simply see more of the same as we have seen for the past month or more. Timing is still for around the 21st-28th May as mentioned on 19th April with the 28th looking best. Until then there is however still no sign that things are about to change.

Both charts this week highlight the basic technical indicators that are present for the coming week. On the S&P the 1x2 line is from the March 2000 high.

*** Note Last weeks S&P chart was incorrect. It has now been fixed