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Summary for Week Ending 26th June 2004
This week we have seen some effort to get out of the congestion we have
been seeing of late with a strong performance on Wednesday the highlight
of the week. Unfortunately this was not followed through with any conviction on Thursday and the week finished weakly.
Looking back over the week we can see that following from the previous
Fridays run forwards we have a 2 day correction down on Monday and
Tuesday. This broke the last swing low but not the primary swing low of
the previous Monday. If this was going to be subsumed then I would have
expected another down day on Wednesday to take it out, This however was
not the case and we saw the market stage an impressive rally on Wednesday
which took out the previous swing highs in one day. This was also
followed with a consolidation of this movement on Thursday which was
good to see in that previously we have seen these extremes in activity
simply get wiped out without regard. We are approaching the last of the
major swing high areas of resistance so I expect the market to peel off
from here before making a second attempt at breeching this level ( if at
all). If we look at the chart we can see that the market initially went
down in 3 days and has taken 7 days to take out the previous highs. Not
exactly a signal of strength.
Seeing as we now have a higher swing high in place, the market is set to
continue with the movement, if ( and its a big if) there is enough
underlying energy around to push it forwards. It is worth noting that
should the market collapse back into the area of congestion, then it is
more likely to stay there as active traders become despondent about the
lack of appropriate trending behavior and the possibility of sideways
action become more evident.
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