Summary for Week Ending 4th June 2005
In a week shortened by the holiday on Monday, the market this week didn't manage to prove too much except that it was intent on essentially traveling sideways. Perhaps the long weekend took the sting out of proceeding but after yet another 1 day decline on Tuesday, the market rallied on Tuesday putting in a wide range outside day. Following on from this we saw an inside day, not unexpectedly, followed by a declining outside day on Friday which managed to stay above the low set on Tuesday.
So far the market has been abe to demonstrate some resilience to last weeks 1 day decline. If we look closer at this weeks performance we can see that the market is building to what is described under Elliott terms as a running correction. This is where the market needs to take a breather but the underlying strength causes this pattern to skew upwards ( or downwards in a fast moving bear market ) if this is the case then we can expect a very swift upwards push before we see a decline down to the initial point of the correction. If the move out is explosive then we could see an attempt made on the old highs and a resumption of the bullish movement in the index.
Following on from last weeks comments regarding time, we didn't see anything happen of Friday so the next point of interest is the 90 day mark which occurs on Sunday. As pointed out on this weeks chart we also have another time range equality coming in at the same time, so Monday maybe worth watching.
Looking at the All Ords, the market continued to rally strongly up to the point of obvious resistance mentioned last week. Fridays losses in NY may show up on Monday here, giving some correction in concert with the resistance level. If it does hold for the week, I don't expect it to hold forever as I'm always prepared to bet against any level that is too obvious.
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