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Markets Getting in Gear?

by Jon S. Strebler

 

The U.S. stock market looks increasingly like it is getting ready to bust out – on the upside – of the large consolidation pattern that has contained it in recent months. Last week I wrote about the nation’s Goldilocks Economy, an environment which could justify and sustain higher equity prices for quite some time to come. To be sure, several serious caveats remain, not the least of which is that we’ve seemed on the verge of an upside breakout several times before, without actually getting it. And despite talk that the Dow Transportation Average is essentially irrelevant, this is Dow Theory Letters after all, and we do consider the junior average of importance. That Average, the Transports, looks heavy indeed and therefore adds a serious measure of doubt as to the true health of the overall market.

 

 

Last week we saw an equivalent chart for the Dow Industrials, ... Log in or subscribe to continue reading.


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