Zeev,
Hope you are feeling well this weekend.
Last Thursday's NASDAQ gain of 1%+ on rising volume would seem to indicate a follow-through day (confirmation of rally). However, the index level accumulation/distribution that IBD publishes daily are pretty abysmal (scale of E- to A+):
IBD New America (startups/innovative) E
NASDAQ C+
S&P 500 C+
NYSE Composite D+
IBD 100 (top performers) E
This is about what it was at the last follow-through right before the post-October dump. It is also what things were like in spring of 2000.
Something else: The current market is spookily similar to the market following the crash of 1929:
1929:
~3 year crash/decline: 8/1929-7/1932
~5 year rally, reclaiming ~50% of lost ground: 7/32-3/37
~5 year decline, giving back 2/3 of the rally: 3/37-4/42
2000:
~3 year crash/decline: 3/2000-10/2002
~5 year rally, reclaiming ~50% of lost ground: 10/2002-10/2007
Are things smelling more and more to you like the secular bear is back? I think the script above is coincidental, but if we continue to follow it, the NASDAQ could go as low as 1690.
The 5 year rally that culminated last October is pretty choppy. I dusted off my Elliott Wave Principle, but can't seem to cipher it out. Are their any E-wave gurus out there that can read the tea leaves?
-David
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