I followed that up with They called me crazy, S and P 900-1000
What next?
- The stock market is currently overbought.
- The technical correction in the current bear market is two months old.
- A major retracement to the downside is likely, and is imminent.
- We could see additional upside to the 940 area versus the S and P 500.
- A test of the 840 area is likely.
- Once the correction gets underway we should get a better understanding of the structure of the market. Begining of long term bull, or bear market still in tact?
- The important 200 day average is still about 100 points above the market and the down ward slope of that average is becoming more severe. This is not a good sign.
This has been a tremendous rally that I expected. However, in terms of price and duration it fits the requirements for a correction in a market that is still trending down.
In addition, the longer dated treasury interest rates are turning up. This is a negative. The dollar looks very vulnerable right now. Another negative. The combination of rising rates in the long end and a dropping dollar does not bode well for stocks.
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 Bob DeMarco is a citizen journalist and twenty year Wall Street veteran. Bob has written more than 500 articles with more than 11,000 links to his work on the Internet. Content from All American Investor has been syndicated on Reuters, the Wall Street Journal, Fox News, Pluck, Blog Critics, and a growing list of newspaper websites. Bob is actively seeking syndication and writing assignments. |
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