The Morning Cup of Jo
Tickles -- That's NOT Funny!!!
Last week Hoofy and Boo square-danced around the topside of the downward channel and now all three majors have another "lower high" to add to their respective technical conditions. This past weekend countless market pundits came out and bestowed their opinion of what's to come next. For what it's worth... out of the ones read myself, I would have to say, it's about a 50/50 race on the 'up or down' opinion.
That uncertainty always leaves me with a warm fuzzy. Why? Because when the market is in a state of confusion for a long period of time, like it has been since the 11-month upward trend was broken, the next move is normally equal to the amount of confusion set prior to a break (in either direction). In this case it could be massive. However, the measure of befuddlement is more art than it is science. There is no true technical measurement for this except the lack of conviction either way (volume).
Think of it this way... When the volume retracts while the market is fluctuating between a high and low - resistance and support - level; this indicates more and more investors are becoming confused and reluctant to commit any further investment assets. Hence, once the battle lines have been crossed, there is normally a massive push in that direction.
Refer back to the June 1st 'Jo' for the battle lines - they haven't moved.
With the Nikkei up over 300 points last night and/or possibly showing signs of dandruff, my gut tells me this is going to be a very interesting week. Keep on your toes, watch for Bear Traps and Head Fakes and be prepared for ANYTHING!
Until next time...
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