decisionpoint.com
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Message 11093243
>>>The NYSE advance/decline line has now diverged
from the Dow for 510 days, which is 33 days beyond
the prior record, set at the 1929 stock market top. Of
particular note is the large divergence between the
Industrials and Dow Transports, which has now
produced a 3®-month long Dow Theory non-confirma-tion.
If the Industrials break below their daily closing
low in August of 10,549, a bear market would be
confirmed under Dow Theory.
Over the past months, we have pointed out numerous
intermediate and long-term technical negatives con-cerning
breadth, new highs versus lows, volume
patterns and momentum. Since the August 10 low, new
52-week highs on the NYSE have exceeded 52-week
lows on only one trading day. According to Peter
Eliades (StockMarket Cycles, P.O Box 6873, Santa
Rosa, CA 95406-0873), from 1962 to 1998, there were
only three days in which the Dow closed at a new all-time
high accompanied by more new yearly lows than
highs. So far this year, it has occurred nine times,
including twice in the last week! The bottom half of the
next chart shows that the 10-day total volume has
fallen sharply since April, and especially so in this last
push to new highs in the Dow. The advance/decline
ratios shown on the NYSE chart on page 2 reveal that
each near-term up leg has been achieved on weaker
breadth. In openly opposing the Dow, these measures
are saying that market?s engine is exhausted and a
major decline is looming.<<<
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