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Bad news.
Yes both are falling.
And we don’t know where to. Well
we can talk about probabilities. But
when we see free fall we stand back and can only postulate and review daily. Unless we are caught out and we need to panic
and take action.
Let’s look at the charts:
Oil:
Click to Enlarge
BHP:
Click to Enlarge
Well you do not need a Ph.D. in technical analysis to see
that neither are in good shape. If you
bought in the heady days of 2008 you would have lost a lot of money.
Both are weekly charts and both show some signs of a rebound
in 2015 but this will take time to unfold as paint dries slowly on weekly time
frames.
Of course there is a possibility they may recover when they
do rebound. That is they continue higher
beyond the wave four bounce.
Another scenario is that before the respite wave four – the
wave five lows may first be reached.
The world economy is not in good shape and while analysts
try to justify equity valuations I see little depth to the move in the last six
years. And weakness lies ahead.
From my perspective the bounce from the 2008 low was without
consolidation. Mad money going mad.
So I expect that markets generally could retest those lows
in the coming year.
And to all, a happy Christmas and best wishes for 2015.
Enjoy the ride
Tom Scollon |