The stock market is behaving just as anticipated so far. The Dow is getting into a very exciting territory. As I have mentioned in the past, we are close to the moment of truth. We are either going to get a confirmation that the bear market rally that started in 2009 is now over or go on to set the next top.
My work shows that there is an 80% probability that the bear leg down has started with the top set in August of 2013. However, there is a 20% chance that the top will complete in March of 2014 instead. Without going into too much details in regards to the timing involved, what will happen over the next few weeks is incredibly important.
Even though the futures are up close to 1% due to Summers drop out, I believe the market will give up gains and this week will be somewhat uneventful. The market is moving up to close the gaps in 15500-15400 range as I previously discussed. Thereafter, it should pause for a little to digest the gains. At that point we should either see divergences indicating the next leg down OR continuation of the run.
Once again, not much to do right now, but wait. Maintain your long position (if you have one) and wait for various confirmations that the bull run is over to kick in. I will keep you posted.
Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!