TREND CHANGES AND THE DANGERS OF CRYING WOLF
Last week brought new all-time highs in the three major US stock averages (Dow Industrials, Transports, and S&P 500) nearly every day, continuing the remarkable winning streak that began a bit more than 4 weeks ago and shown below.
We cannot, or should not, hold a grudge for what seemed at the time a break in the market’s long uptrend immediately preceding this latest rise. Any sell signal given in early October has by now been proven incorrect, as the market is rather clearly marching to its own, very bullish beat. And it’s not just technical (chart-based), as US retail sales have again turned positive and consumer sentiment rose to the highest level in 7 years – both benefiting from the lowest gasoline prices in years.
While conceding that the bull market is alive and well, we nevertheless have the ... Log in or subscribe to continue reading.