Donald,
I too believe that the DOW has seen its peak, but am more concerned that the NYSE/NYA has seen its peak (long ago in fact, Jul 15 99) and as of this week the technical damage has only increased, as that index broke down out of its zone of congestion (begining May 13 99) for a 6th time, and at the same time also broke the trend line from Oct 98's lows.
In all this time, the NYA only spend part of July 99 above the zone of congestion - lets call that one event. So all in all, not a bullish condition to say the least. Unless the NYA can pull back above 615 and hold, an in fact rally well, we must consider it to be in a bear market until proven otherwise. Certainly that makes more sense now than ever, as the majority of the time the NYA spend below the zone of congestion was during the SEA financial crisis.
Now its a lack of love. Or? ;)
The SPX I believe we need to look at a number of zones, the current one defined by 1404 and 1425. It has yet to fail outright so we'll have to watch and see. A break means that 1371 is the top of the next zone that we need to be concerned with.
As far as I'm concerned a top is in, until proven otherwise. The uppermost zone of congestion was last broken on Jan 21 2000 and except for a brief revisit on 2/7, the SPX has proven its current intentions by immediately retreating into the zone lower that the market is currently in.
I'll be watching these levels during rallies and acting accordingly.
Cheers
Michael |
