XJO Cash Monthly chart"My view on Resource stocks were that they were moving down into lower lows in November. With Resource stocks moving lower in the 4th Quarter and Financials already trading around near their highs in the 3rd Quarter, there wasn't much hope for the Aussie Index.
I've been bearish on Resource stocks in the 4th Quarter with the expectation of lower lows into November" Previous Weekly Report
This Week Resource stocks have been hammered. There could be some support coming into resource stocks around this week's lows, which could support the market for a couple of weeks.
But as I've been saying for a number of weeks now since August:- I expect further weakness of resource stocks into November:- Dilernia Principle
"Long term:- October lows resistance (breakout forms resistance), and the trend guide for the 4th Quarter will be defined by the November 50% level.
If price remains below the October lows and closes below the October lows on the last day of this month, then there is an expectation that price will continue down into November lows.
If that's the case:- then around November lows could provide the ideal 'swing' low for a swing back towards the 2008 lows breakout.
If there is any support around the November lows, then this can result in Price making it's way back towards the breakout of the 2008 lows late in this 4th Quarter or early in the first Quarter in 2009, and then continue lower from 2009 into the new Yearly lows. "
Previous Weekly Report
This Week has seen the Aussie Index like all global indexes test the October low breakout and fail.I'm currently looking for a couple more weeks of sideways volatility, and then define the Trend by November's levels, as shown above.
Any down trend into November's lows, and my view is will be price will finally find 'a bottom' in 2008, but not 'the bottom' in this bear market.
I'm still expecting lower lows in 2009.
