Markets did finish the week lower, as we predicted. If anything, sentiment was more bearish than we thought. The American market finished down 1% Friday to finish at the lowest level since 2006. The Dow closed at 11,893 down 146 while the S&P closed at 1293 down 10 points. This was a clear breakdown of support levels, although the technically inclined may note that the Jan 22 intraday lows (11,500/1270) have yet to be breached.
Our Tokyo and Bombay calls were also fairly prescient as the Nikkei closed at 12,783, down 430 points Friday while the Sensex ended the week at 15,975 down 580. Our revised forecast had suggested that the Sensex would close around 16,000 so the skittish mood was borne out.
The bull market in the Euro, oil and gold did continue, although with some divergences from our expectations. The Euro ended the week much stronger than our forecast, closing at 1.5357. Oil closed Friday above $105 without any retracements. Gold did finish off its mid-week highs of $992 to close off a bit at $972.
Oil seems overdue for a pullback, especially since Saturn is aspecting the Moon in the futures chart in the next two weeks.
