LOST DECADE

The market leadership has een from big cap stocks, historically this can skew some readings that make market appear weak, but one thing present in this rally from March has been a drop in buyers demand, BUT and even fatser drop in those wishing to sell. SO we can imply that the gains in the market is more a result of a withdrawl of selling than a CONVICTION of buyers to buy.

I have read for instance that back in 1998 some of these trends persisted for nearly 2 years before a TOP was put in place. SO when we search for THE TOP and see divergences, they are mearly WARNINGS signs, not immediate indicators.

Just recently the US $ has broken out of its downtrend channel, and we have shown since March the fall in $ value resulted in the March rally and this relationship has continued....until now?

I DO find that interesting that this big US $ move did not find Friday a HEAP of covering from those short $, long GOLD and EQUITIES, yet we have seen gold retrench.

We also have the indexes STUCK in a month long trading zone I will put up chart next post, until we get resolution here we will not know ST direction of action.

MY guess, is with $ breaking out, LOW buying volume and interest, there is not enough OOOOOMPHHHHHH to push the indexes OUT and ABOVE upper range.....and will sellers step up and take the SPX down and out of lower bounds near 1080?

FRI Consumer Sentiment was shown to improve, bullish articles on spending and retail (believe it or not), housing etc have surfaced, and the GOOD NEWS did not provide the fuel to break out over 1120 (50% FIB of SPX)

Should it do that , the stage would be set for another leg up......I can be bearish on fundamentals, but that doesn't preclude a move higher. Just as I got several bullish warnings near the March bottom, I should await bearish signals based on technical analysis to confirm the Bear's re-emergence.

I do feel action taken so far has NOT fully revived the economy nor has it fixed the underlying problems, it has masked them, so EVENTUALLY the correction and change must come to pass.

LOST DECADE link to FT story

VOLKER GIVES WARNING link here

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