Replies to post #105782 on ajtj99's Market Pulse

[ajtj99]

JD, I remember how excruciating it was in mid-1999. My positions did nothing for 6-months. I think we had that in 2004-2005 on the NDX/COMP.

There are several cross-currents here.

On one hand you have some fundamental issues:

-Sub-Prime, Alt-A meltdown.
-CDO issues
-Credit spreads widening
-Oil near record highs
-Housing starts way down, existing sales way down
-Fed not loosening, not tightening
-Inflation
-LBO surge pausing
-Dow Transports appear to have topped
-Dow Utilities appear to have topped
-Banks are in trouble

On the other hand, we have some technical issues

-Short Interest is at a record high
-Put/Call ratio is at extremes
-McClellan Oscillators are sold down to extremes
-Too many people were bearish going into the top
-COT shows commercials still bullish
-Presidential election cycle favors a strong 3rd year
-Several cycles are clustering now
-China still has lots of room to the upside on the charts.
-Many indices just made record highs in July
-Most monthly charts do not show negative divergences that are commonplace when big down moves are pending.