Overnight the Australian Dollar and metals were sold off heavily, as were European and US markets once again, gaining momentum from the previous day. These factors put further pressure on our market today which opened lower as expected. A rally in the early afternoon gave the impression that the market was going to hold up well but that was put to rest as the afternoon progressed and selling took hold. The end result was a 1.6% decline of 61.7 points for the XJO which closed out the week down 246.19 points or 5.9% – a week it would rather forget. As was the case yesterday, small caps lagged the large, today the Small Ordinaries down 2.8%, and again Metals/Mining, Materials and Gold bore the brunt of the declines as the hardest hit sectors. Continued high volatility and choppy price action is not making this market any easier to trade. The August 9 low is within the XJO’s sights – just 138 points off so next week should find the market at a critical juncture.

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