Internals today match the price action in that it they were slightly bearish. Volume kicked up a bit today but still light at just over 1 billion shares on the NYSE. The internals and price action suggest the weakness this week is just a correction, but if it is a correction then I think it's likely a very small fourth wave that one slight quick pop higher to a new high should mark a top.
The wave count and momentum (RSI) suggest the rally is in its final stages. But what's new, right? I've been saying that for a week or so and the market just floats higher. That's why I wait for confirmation or solid evidence a top is in instead of just trying to "guess" when a top is in right in the middle of uptrend. Without any evidence of a top, I have to expect higher levels to come.
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Despite the lack of an impulsive decline or convincingly bearish internals, the chart above shows how today's action might end up being quite bearish since the late day rally was able to close the gap at the open this morning. Continuation to the downside tomorrow morning would be very much welcomed by the bears and suggest that a top may be in. On the other hand, if the market makes a new high instead, I still believe that high will be very short lived and reversed. Either way I feel the bears should have the fingers (paws) on the trigger ready to get short. But as always, patience is key. I want the market to come to me and play into my rules, not the other way around.
The euro count I posted yesterday looks good after today's downside action. If the count is correct, there should brief, short rallies and selloffs should be big and strong. I am firmly bearish the euro at this point, and bullish the US dollar.
PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.
1 comment:
The Dow is leading the other stock indexes up to higher highs thru current resistance levels, so new high targets are now in order for bullish goals. With a one day selloff meeting waiting buyers that recovered the large selloff in just two days, it should be apparent to all that the bull move is stronger than ever. The trend is your friend, so make money on the long side. The daily price is far above the 50 day moving average,momentum is staying possitive,most technical indicators are possitive, so expect the next Dow target of 13000 to be approached soon. The PPT will keep supporting the markets even at these levels. It is a strong bull move.
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