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Short-Term Market Faces a Turning Point

2007/12/3 15:26:04

Last week's retest toward 5000 hit the upper rail of the descending channel from 6004 and turned back. Now, that upper rail has dropped to around 4950. Open the 15-minute chart and you'll see it very clearly — the 10-day moving average is also moving down to that vicinity. In other words, the moment of change is about to arrive.

Purely from a technical standpoint, it's either a breakout above the upper rail triggering a total retest rally against the decline from 6004, or one more bear trap before that total retest. In any case, the arrival of this retest rally is an imminent matter. The only difference is whether there will be one more bear trap to scare off the last holdouts who can't endure any longer.

In fact, from the individual stock perspective, many stocks have already rallied quite a bit. The index looks this bad mainly because of PetroChina doing its thing. But that oil stock is about to break below 30 — the first basic target has essentially been reached. The only variable is whether it needs to briefly break below 30 to scare off the last uncommitted holders, which corresponds to whether the broader market needs one more bear trap.

The individual stocks this ID has previously mentioned — it has been repeatedly stated that every single one will continue to be traded without exception. In fact, quite a few have already started outperforming the broader market. Other stocks will also respond once the broader market improves.

However, after this retest rally, there will be at least one more bottoming-confirmation process. The 10-month MA, from a short-to-mid-term perspective, should be quite important. Below that is the 250-day MA position — before the 250-day MA is broken, there is absolutely no need to discuss whether the bull market is over.

From a mid-to-long-term perspective, the current uncertainty is whether that economic conference will produce any particularly aggressive measures. But regardless of what that conference decides, it shouldn't cause a fatal impact — it will merely be exploited to flush out uncommitted holders.

For that acquisition matter, the head of a certain group flew in specially from Hong Kong and is waiting downstairs. This ID needs to go entertain them. Signing off, goodbye.