Share Market Wrap 5th September 2008

http://www.youtube.com/watch?v=0lHj_X4mLIk

Despite oil prices falling around 23% over the past two months, we are still paying high prices at the pump. The reason for this is that the Australian dollar has also fallen around 14% against the US dollar during the same period, which has effectively eroded any benefit from lower oil prices.

If the price of petrol is to fall, we need oil to continue its downward trend and the Australian dollar to stabilise or rise against the US dollar, which I believe is likely over the next few months. That said I expect oil will find support around $100 or slightly below before rising up to test the previous high early next year, so if petrol does fall it many only be short lived.

What can we expect in the share market?

While the market was bullish for more than a week, it has fallen heavily over the last three days as investors react to the pull back on the Dow. In my last report I indicated that I expected the market to continue to rise for the next 1 to 4 weeks before moving down again. Technically the past week has been an up week given that the market traded higher than last week. And despite the heavy falls in the past three days I still believe the market will be bullish until the end of the month before it falls away for one or two weeks.

I am still confident that that the market will be bullish over the next 12 to 18 months, where there will be plenty of opportunity to take profits from several of the large companies on our market, once investors shake off the negative sentiment. That said I don’t believe it will be all smooth sailing but once the momentum increases so will the market confidence.

Dale Gillham
Chief Analyst
Wealth Within

Dale Gillham, ‘one of the country’s most respected analysts’ (Wealth Creator Magazine, Nov/Dec 2004), sought after key note speaker and author of the best selling book ‘How to Beat the Managed Funds by 20%’, has assisted thousands of traders and investors to become confident and profitable in their direct share investments. Tired of an industry saturated by quick fix gimmicks and expensive short-courses, Dale co-founded Wealth Within to provide ‘ real education and ongoing personalised support’, as well as independent investment advice to traders and investors who have become disillusioned by the market for one reason or another. As testament to this, Wealth Within launched Australia’s first and only nationally accredited Diploma and Advanced Diploma of Share Trading and Investment.

For more information please visit www.wealthwithin.com.au

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