****UPDATED CHARTS****
Last week, we said to look for the following to occur:
1. New highs in Bonds and the Dollar to continue.
2. One more spike up in the VIX.
3. A possible turn in the Summation Index.
4. Nearing key support in the Russell 2000.
As you can see from this week's updates, that wasn't a bad call.
But what now? I don't mind going out on a limb so here goes:
I expect the Bonds and the Dollar to consolidate recent gains...while
the stock market
MOVES UP to catch up with these two markets. Historically, Bonds peak
3-6 months
ahead of the stock market. (Read this sentence again.) With Bonds now at
new highs,
again, I expect NEW HIGHS in the stock market ahead.
I expect volatility (VIX) to decrease immediately ahead.
While the Summation Index DID hook up mid-week, only to turn down,
again,
I expect another hook the other way (UP) for a more lasting move.
Lastly, I believe the Russell 2000 will hold above its long term
trendline. REMEMBER:
This is a WEEKLY chart...so while a penetration below this line is
possible, it's where
we close next Friday that counts.
Final note for the more bearish among us:
Hemlines are going down this Fall. (For those not familiar with this
"fashion indicator,"
hemlines and the stock market are supposed to go in lock step. <g>
pw1.netcom.com
All have a good week.
Claud |
