october highs, page-8

Interesting situation... sudden drop of 6 points right on the bell was a kick in the guts for bulls.. gold, copper, oil all down a bit in spot trade at the close of xjo... xjo the most bullish today of the asian indexes I monitor live... xjo, spi, hang seng, ftse all pretty much the same shape, up against resistance... so on the face of it, expect a retreat from here for xjo... but if you take a 'behavioural' perspective, these indices including spx and dow are all at resistance but have actually not retreated very much... this means that at least for now they are absorbing the selling pretty well... unlike days when xjo has touched a new high or resistance and fallen right away immediately... normally I'd be comfortably bullish as an investor in this situation but the volume is a worry.. volume on the dow has been lowish anyway since the end of August but over the past few days including the down days volume has been falling from this low base...yeah yeah the media spin is that a few US jews are at synagogue so vol is low yesterday but that doesn't explain the trend... I take from the volume story a lack of comittment by bulls, which makes the resilience of the rally a bit sus... and it will not reach new highs on this low volume... and taking into account seasonal factors (end of quarter finished) and accellerated downtrend in US economic data raising higher the probability of a US recession ... the likely scenarios are either lateral or down, with further moves to new highs the least probable move atm. My thoughts anyway... cheers!