0.99 cents and understanding teefer, page-44

AXO = XAO

Worthy of note...

Step 1: Jun 2001 we finished at 3425

Step 2: We then saw a rather quick sell down of some 13%

Step 3: Jan 2002 we finished at 3404

This was to become the double top that lead to the correction down to...

Step 4: Feb 2003 we finished at 2778

Whilst the XAO fell lower intra-month to 2666, it did not actually finish any month at a lower level.

This represents a correction of some 19% month-to-month...and an overun correction of some 22% on end of month closing prices...all of which was flagged initially by a quick 17% intra-month correction and equally quick recovery.

So...

Flag = -13%
Recovery = +13%
Correction = -19%
Overun = -22%

Lets race forward to current activity.

Step 1: May 2007 we finished at 6341

Step 2: We then saw a rather quick sell down of some 15%

Step 3: OCt 2007 we finished at 6779

This was to become the top that lead to the correction down to...

Step 4: Feb 2003 we finished at 5414.

???

If so...

Flag = -15% (previous = -13%)
Recovery = 22% (previous = 13%)
Correction = -20% (previous -19%)
Overun = -24% (previous -22%)

This represents a correction of some 20% from close to close, with an intra-month overshoot of some 24% and flagged by a correction close to 15%...more or less the same results we saw back in 2001, which of course were more or less on the back of 911 (September 2001) attacks and subsequent global meltdown.

So I guess the question we must ask is this...

Does sub-prime = 911 in global market terms?

Form mine, there are similarities...and significant differences...but I suspect the bottom lines more or less equate, as such I feel we are close to the bottom of this cycle, if not already past it.

Remember, nobody will be ringing a bell to tell us the bottom has been reached!

Of course everything above equally applies to CVI.

Cheers!