I have been saying all along that we will have an October BK... IMHO. This is the theory that "....it always takes longer!"
And here are some fairly good reasons:
- the only bearish P&F for the major (not NAZ) indices is the % P&F for the SPX;
- volume indicators, which are akin to sentiment, shows enough fear to turn things around awhile;
- unless earnings come in putrid, or unless there is some major unforeseen event awaiting in the wings for us... there is nothing to really get a good sell-off going;
But if you want to see something quite chilling, look at this P&F for the DOW-30 Industrials: stockcharts.com[PA][D][F1!3!!!2!20]&pref=G
(For those of you not familiar with Point and Figure charts, the P&F process removes the element of time from the chart and plots just price action. If you look at the chart at the link above, you will notice what looks like a "mountain" starting at the 10,700 level coming into 2006 and continuing up until now. The repeated excursions from 10,700 to higher levels and returning to 10,700 is the left shoulder and we just formed the armpit of the right shoulder. If price action carries that plot below 10,700 any time in the next several months as I anticipate, it will be a breakdown in the pattern and normally the selling continues for another 1,000 points, in this case.)
The concern, of course, is if this breakdown does occur, that will be the impetus for a major breakdown which will lead to another BIG BK!
BWDIK? |
