What is critically important to the rest of this summer, and 2012..is which direction the transports eventually takes.
Transports, monthly
Summary
The near term range is 5000 to 5400. Bears will need to see a July close in the 4900s..whilst Bulls will need something in the 5500s to be sure of new up cycle.
From a cycle perspective, the indicators are still relatively bearish. There is nothing bullish yet, its all been chop since January, in a relatively tight range - especially relative to the other indexes.
The doomster 4000 level
Arguably, anyone looking for a market collapse will need to see the transports under 4k. Of course, that is 20% below current levels, which would make for an official 'bear market'. A 4k break would probably lead to 3500, but that is indeed right now mere 'crazy talk'.
First things first....lets see where we close in July, a close either side of the current range..will be VERY important to be aware of.
Goodnight from London*
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*..and for those in the USA, enjoy your independence day. Wednesday is indeed your special day to celebrate your freedom from your once all powerful British Royal overlords.