rally in the next two monthsTime to get back in the game
by Yola Edwards Jan 13/09
From its highs to its lows, the Toronto stock exchange index was down a whopping 45 per cent for the year, but only finished down a staggering 35 per cent due to the 677 point year-end rally. It appears that the worst is behind us and it's time to get back in the game or add to portfolio positions.
The month of December saw the TSX stem its decline and it appears to have put in the bottom that everyone has been looking for. The weekly chart is certainly encouraging as the index completed a bullish falling wedge the first week of December and then traded sideways. The monthly chart confirms the optimism as a bullish monthly dragonfly doji candlestick signal, which is a reversal signal, confirms a bottom is at hand. The moving averages and the MACD are turning positive so any near-term weakness, if it materializes, should be bought. If the first day is an example with a 246 point gain then we're off to a great start and we may be looking at exploding markets in January as investors return from their holidays.
The year starts out at 9234.11 and a rally to about 10,250 over the next two months is quite possible.