TSX Index (11651)

In my February 1st 2006 Market Comment, I called for a general market correction including resource stocks. Since then, the TSX has experienced an abrupt selloff. So far, I cannot see an end to the steep slide, but from my unique price momentum models, it is clear that only short term influences are at work here so far.

The TSX had a fantastic intermediate and long term head of steam up before the selloff began, and nothing much has changed, in spite of the fact that meaningful short term damage has been done. I'll be watching to see if we will put in a short term price momentum low before we impair the otherwise strong intermediate term pattern.

If we get a short term low without damaging intermediate term price momentum, we might just look for a "snap back" rally in March. For now though, the short term steep selloff continues and I remain on the sidelines. It's "wait and see".