bowman711

The Worst Is Likely Behind Us

It would seem to me that when businesses start to see the end of a downturn they would decide to order new materials with which to manufacture their products. Therefore, it would seem at raw materials, known as 'commodities' would have to be mined and then shipped to those who produce steel, aluminum, and other products used in various manufacturing material processes. I haven't seen an upturn in either commodities or in ocean shipping of raw materials.

Therefore, the rally at the end of October to 38% of the October drop (in the DOW) looks more like a bear market rally than a turnaround. [Those of you who know or use fibonacci know that 38% is the first critical level to be met. (After that comes 50% and then 52% retracement.)] We'll probably see this week if 38% holds, which would give a bit more, but not complete, hope that the bottom is in. I believe we will test the bottom again before finding a final bottom. If the mid October bottom doesn't hold, forming a double bottom, then it is almost certainly probable the DOW will have to find another low in the mid to low 7,000s.