All is calm on the western frontier...

So lets get an update of the long term picture - a rehash of a post of the ALSH chart which previously showed where technically some pretty heave resistance lies.

 As one can see a second test of the resistance is underway. Will it break - possibly although short term probably not. The market as it stands has been climbing relentlessly and it is in need of a breather. It it does break it could be an aggressive climb higher although lets not bank on it. The resistance (which previously was support) managed to buoy the market four times, while building a kings crown of a top.

With Marcus cutting rates to everyone's surprise, I'm expecting even more cuts as inflation will be muted and the economy IS going to struggle. Pressure from unions and from horrible growth figures will force her hand. Another surprise is looming  just around the corner - shares are heading for a hiding. I know I sound like a broken record but even though markets can blissfully ignore fundamentals these will EVENTUALLY come home to roost.

Gerald Celente an eccentric forecaster is predicting a crash of 2010 and really has a gift of putting across complex scenarios in a very clear and concise manner. Have a look at this clip and you will see a pretty ugly picture. China which is now SA's largest trading partner is really not such a goldilocks story and if they experience pain down the road we will experience it doubly so.





Good Trading