Summary for Week Ending 3rd February 2007
The market did as it has been doing for some time now, and went ahead. There isn't too much to say about this as it is doing quite well without me rabbiting on about it.
Last week, just for something different I looked at how the personality of a trend can change, over time, indicating differing attitudes and levels of enthusiasm. This week, again for something different I'm looking at the pace of movement.
Looking at this weeks chart I've marked up the relevant passages of play that we've witnessed over the last year. When the market took off initially the pace of the attack was consistent and lasted like this for 90 trading days. We then got a slowdown, and the market began to contract as we approached the Xmas period. This is evidenced by the way that the markets original pace of attack slowed down and gave a an almost topping pattern. This pattern lasted for 32 trading days. This second pattern gave us a rising compression pattern with higher lows. Ordinarily if the market is to break upwards from this pattern it is usually very strong and should give a pace of attack equal or more severe than the first movement, that is, the market should accelerate out of this and move to higher levels quite quickly. This can be an exhaustion movement, however you will only get real exhaustion IF the market runs strongly and absorbs all of the available buying pressure. Theres a bit to go before we see any of that.
Nothing stopping more of the same for the coming week.
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