Our market lost some ground today, the XJO and All Ordinaries both down 1.6%. If there was a positive it was that the volume is still on the light side as it has been all week. If we have a retracement here, which would be no surprise as the market is overbought, we’d like to see it on light volume. There is also a distinct lack of short setups at present so there is no inclination here to look to seriously at short trades even though the trend is about neutral. Rather, we’ll watch for long setups to materialise as the market retraces or consolidates and await the next more higher. A deep retracement may damage some patterns which look to be currently forming, however. It could be a testing time for the market over the next couple of weeks if the US is to provide the lead. Early indications of their reporting season suggest it could be a rocky road – up one day, down the next – reporting really shifts into full gear next week and for those trading the US it is certainly not a market to hold positions through reports (which we avoid here at The Chartist at any time).

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