Justa, are you referring to long term charts, such as a 10 year chart, in your comment about broadening tops? The long term charts for Russell 2000 and Dow transports may have a broadening formation. The Dow, SP500, NYSE look like they have a rounding top in place. In one of Hays recent comments, he showed a long term chart of the nyse financials, which have a rising trend, but this is one of the few that is rising. Perhaps the financials are rising because of the large decrease in interest rates that we have had. Hays thought the trend in the financials were very bullish, but in the context of the other charts, I am not convinced. These long term topping formations in most of the averages are disturbing....if the chart action plays out, the stock markets will be showing negative to flat results for a number of years. According to the technical analysis texts, rounding tops are a very reliable formation, ie they almost always correctly predict a significant decline. Have you looked at these charts? What do you think?
Robin |
