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The long term performance of share markets is truly remarkable; a fact that is easily demonstrated by looking at a chart of any major market index. Despite regular and often severe effects such as wars, recessions, bubbles and crashes, the major industrialised markets have always recovered and gone on to carve out bigger and better gains. Over the long term, the share market has always outperformed all other asset classes, period.

Reporting season can be a tricky time at best. In the good times the odd negative surprise can be brushed off as just being a mere blip and all will be forgiven in time.

When we last left Santos (STO:ASX) in Issue 309, it had suffered a significant sell-off in the aftermath of a 2-day trading halt due to a capital raising. The market was clearly oversold after falling 14.5% from the close of trading on 8 May to the close on 14 May. It then came back and made a first higher bottom on the 1-Day Swing Chart. I finished the analysis with the words, ‘this is yet again a time to watch this market carefully for a signal.’

Two names synonymous with Technical Analysis are Gann and Elliott, each having their die hard followers. As in many walks of life, people claim their area of study to be the best. Just look at diets, martial arts, weight loss programs or anything related to some kind of personal improvement. Practitioners of each style or method claim theirs is the best, hands down. The funny thing is most work in a similar manner to the same end. Trading in many ways is no different. I am a fan of the saying, “If it works use it!!”

This week we learnt that Australia has (so far) narrowly avoided a recession; a technical recession that is. However there is another technical definition that has so far largely escaped popular attention…