January 03 is a cycle turning point...and this time, i believe it may be an important one. depending on the action immediately preceding it, it will be a high or a low.
this whole rally from mid October looks suspicious to me...Tick consistently negative, 21-day TRIN reaching the most overbought levels of the 90's, put/call ratios collapsing to all-time lows, a/d and nh/nl in free-fall, interest rates rising, AAII poll bulls at a multi year high,transports, banks and utilities diverging, the market completely ignoring the Y2K potential for disruptions,IPO-fever and penny stock speculation breaking out in earnest, a liquidity splurge and credit explosion in an already dangerously overheated economy, the current account and trade deficits exploding to new all time highs both absolute and relative to GDP, oil prices at multi year highs, and last but not least, 8 elves are bullish, 2 are neutral and none are bearish...
one could argue that some of this evidence contributes to the 'wall of worry', but that argument is clearly invalidated by the fact that there is no worry discernible...listening to commentators on CNBS today i had the distinct impression that most of them think the bull market is only just beginning.
remember: no bell rings at the top. |
