On the eve of the Fed meeting, which I feel leaves no DRAMA in doubt, they will not raise rates, what then is left to ponder as the Dow is near 1% of its all time highs?
New 52 week highs are dropping off as we approach this milestone. The Transports are 600 points away from their March/July double top all time high.
Oil, commodities of all kinds copper, gold, silver are dropping like a stone. Some funds like the USO (OIL) just hit a new 52 week low!
When you look at how we got here, record bubble housing numbers, which fed ALL Kinds of economic areas like home remodeling, paint, furniture, mortgage lending, financials, real estate firms and construction companies......far reaching were the effects of this FED Induced bubble.
NOW IT'S GONE!
Housing stocks have tumbled, HD languishes, oil stocks declining sharply.
SPX earnings were being carried by RECORD EXXON and the like profits, that is now GONE!
The housing market, though some think soft landing HAS peaked, and has the look of a bubble which has popped.
YET, the stock market is poised a mere pittance away from a MAJOR MILESTONE! yet breadth, and many data points show a much weaker picture, a VERY SELECTIVE market advance.
I have no crystal ball, let's see where market goes after 2:15 today, but we have a 2 1/2 yr divergence in place as I have shown in prior charts and that will get resolved.
The Transports made their new all time highs as beneficiaries of Chinese imports, a surge in consumer spending on all things not made here. Now TRansports lag the party, how interesting.
Duratek
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