Best scenario: retest and confirmation of previous bottoms

12th May 2008: Not much change in Asia last week. There are still encouraging signs in Hongkong, Korea and Singapore. All of these markets have made little bottoms, giving cause for hope that they - and the region - have bottomed. The problem with the bottoms is that they are a little small. We could easily see the markets retest their previous lows over the next couple of months and, with luck, make larger bottoms.

The same comment would apply to US and European markets. Indeed, if we are to see global markets bottoming at around the current level, another plunge to previous lows and a few months confirming supports at previous lows would be the most reliable evidence of a bottom. 

This is wishful thinking at present. There are other, less desirable, scenarios: markets could meander around for the next few months giving us no clues as to direction; markets could rally upward on current thin volumes, giving us cause for anxiety about another crash; markets could test previous lows and fail, setting further new lows.

Of course, the first scenario, retesting and confirming prevous bottoms would be the best case scenario. Fingers crossed and let's see how the next six weeks pan out. 

The next update will be on 26th June. My secretary and I will be taking overlapping vacations during the next six weeks. When she returns she will post interesting charts for my benefit. You will find links to them on this page. Otherwise, you should be able to make sense of things by yourself. All of the scenarios are laid out on the charts for each country. All you need to do is to extrapulate from them using current closing prices. Good luck and see you next month!

gb 
 

Other markets:  EFA, Europe, Australia, South Africa, Global Energy,  Global Materials, Silver, Gold, Euro, Deutche Bank and Nokia

Important note: This website will hibernate for about six weeks as my secretary and I each take overlapping summer vacations. There will be no updates from May 19th to June 30th. Throughout June there will be sporadic updates of important developments on a special page to be created. The last full update will be on May 12th.