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SPX, INDU, RUT, NYA: Market Wants a Debate


The bears are demanding equal airtime...


I also want to point out the stark contrast between a couple markets, to illustrate how it's difficult to find an over-arching theme. First is the NYSE Composite (INDEXNYSEGIS:NYA), which (so far anyway) looks like nothing more than your average healthy correction.

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For contrast, we have the Nasdaq 100 (INDEXNASDAQ:NDX), which has now retraced 50% of the rally off the June lows.

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In conclusion, the short-term trend is currently down across markets; the intermediate trend has shifted to down in several, but not all, markets; and the long-term trend remains up. INDU, RUT, and SPX could be counted as complete waves down, but it is unclear whether we should anticipate a fourth wave higher followed by a fifth wave down, or whether the pattern is roughly complete.

I remain of the opinion that the final high isn't in yet (for INDU and SPX), but bears certainly aren't going quietly into the night. A small bounce here which was followed by lower lows that held key support would be acceptable for the intermediate bull case, but a large bounce that fails to reclaim 1464, and which then subsequently broke the recent lows, would suggest a very bearish longer-term outcome. Trade safe.

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