NYSE Comp, weekly, 2yr
NYSE, monthly, rainbow, 6yr
Summary
Clearly, we need a break <7800 before the broad uptrend can be said to be broken. In fact, at least 1 or 2 weekly closes under 7800 until we can be confident that the post-June up cycle is complete.
Downside target - if 7800 broken, is arguably around the 6900 level. That would equate to sp'1200 -which is currently my 'best bear case' target' this Autumn. There are a fair few people looking for <1200, but I find that hard to believe as viable. Also, lets not forget, the Bernanke will be out there, and my best guess is that QE3 will be announced at the FOMC of Dec'12'th. That would coincide with a very natural Santa rally into Christmas/early 2013.
As a counter to the weekly cycle, the monthly rainbow chart for the NYSE is still outright bullish, with two consecutive green candles. This is certainly not good, and we'll need to see September close with a blue, or preferably red candle.
So, the Bernanke is now just over a day away. His remarks aren't even televised live (I believe). Doubtless the cheerleaders on the clown networks will all be on suicide watch if Benny is not overtly hinting at further easing/policy measures for this Autumn.
Friday...could be interesting, but lets not forget, we've a 3 day weekend ahead (US markets closed Monday). Before we realise it...summer will be over, its time to prepare.
Goodnight from the Paralympic capital of the world
