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The decline from the Tuesday high so far looks corrective. A break above 1137.22 will really make it look like a 3 wave drop, correction (Elliott Wave Tutorial, 3.4). If so, a break to a new high on the week is imminent. Also, the Nasdaqs are leading the charge higher and the NDX almost made a new high on the week with the Composite following closely behind. Also, the British pound made a new high cancelling out the 5 wave drop I mentioned in yesterday's post, yet now the euro is struggling. But there's no compelling evidence to suggest a top in these two currencies, which means a US dollar bottom MAY not be upon us quite yet. And lastly, the internals and strength of the decline fit more of a correction, not a reversal in trend......at least not yet. I'd expect much stronger selling with much more bearish internals than what we're seeing right now if a top was in.
However as I've said before, if the indices do get to new highs on the week, they should not be long lived.
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So we'll see what develops the rest of the day. More later....
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- In an economic depression, will pension funds keep most retired Americans afloat?
- Who really benefits when the government props up Fannie Mae and Freddie Mac, and what's the fraud behind the idea of “too important” to fail?
- Who does the government consider to be homeowners: you and your neighbors, or the banks that hold the deeds?
- Who really endorsed the emergency Housing Act – and who will be hurt by it?
- Can the Fed keep making loans to banks forever?
- Is it actually against the law in some states to warn people of potentially dangerous banks?
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