TSX Index (10644)

In my blog comment on October 5th, 2005 (TSX 10820), I said that the index was backing away from important round numbered resistance at 11000, and I expected more of the same on the short term. The index quickly sank to a low of 10145 before recovering to its present level. The quick recovery is a testament to the strength of the underlying long term trend.

I had pointed out that I expected the TSX to take two months or more to work up the steam to push above 11000 (this assumed that the long term uptrend remained intact, as is the case today). It has been five weeks or so since we slammed into resistance at 11000 and backed away, so I'm guessing that the current recovery will get sticky and retreat again soon. In fact I suspect that the index may be a bit toppy short term as I write today.

I'm in "wait and see" mode for the short term. Assuming that all things remain as they are, I still expect upside penetration of the important 11000 resistance barrier once near term backing and filling has run its course.