The Globe and Mail

Ron Meisels’ charts are telling him to expect another market down leg that may be less severe than the August sell-off but could take some time to run its course. “Just in time for the usual start of the late- October/early-November year-end rally,” he writes.
The main reason for another swoon is that sentiment in mid-August never reached extreme proportions because after a couple of days, the consensus suggested it was just another buying opportunity. “Markets bottom on fear, not greed,” he warns.
When markets complete the latest negative wave, he predicts a new bull market could take flight, lasting through 2008 and possibly the first half of 2009.
His current sectoral reading has energy “selectively positive,” as stocks such as Canadian Natural Resources Ltd., Petro-Canada, Imperial Oil Ltd, EnCana Corp. and the more speculative Connacher Oil & Gas Ltd. have all held their ground, despite the August sell-off.
In materials, Barrick Gold Corp., Agrium Inc. and Teck Cominco Ltd. are “targeted significantly higher,” while insurers “look much better” than the banking sector.
Consumer staples are still a “major disappointment,” as Loblaw Cos. Ltd. and George Weston Ltd. are hitting multi-year lows, he adds.