Last week the market tried to rally, but the volume was low which indicates that the Bulls just do not have the numbers to push the market higher.
With the US now looking to undertake some long term infrastructure work, providing jobs for the many Americans out of work right now it is taking us back to the good old days of the depression. A time when leaders were exactly that and did what was necessary and not what was popular to look after their citizens.
Perhaps those in our capital city could take note and follow the lead of the US once again.
Back at home our economy is stronger only thanks to the mining sector, for those who can remember, it was not long ago that we rode on the sheep’s back.
Short term 5-10 years Australia looks to continue to profit. However we must be careful not to run a one horse race. Manufacturing is a major part of any economy and it is clear that the US knows this. Do we?
Short term being the next 3 months I expect to see the market get back to 4500, which is 8.5% above the current level. As such I still have a strong buy for quality stocks in the current markets, I do expect dips perhaps below 3900 but do not wait to put all of your money in on the dip.
Dollar cost averaging is the sensible way to approach this market.
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