According to the Summation Index, we have been in a decline since about September 24th.
Now, a person might say how can we have been in a decline if the markets have climbed higher? The answer may be that THIS decline is really more of cooling off period than a true decline…
And when the RSI line rebounds from about the 30 mark or lower, it can be said that a new, strong rally is resuming. Notice the MACD-h is climbing, often a leading indicator for the future direction of the market. This bull seems to have plenty of life in it.
…But the bears may get their way for a few days here, though mostly on sideways action, or up-down action between trading sessions, before a new strong impulse begins. Those Bears looking for a crash may have missed that target by about 11 months (yes, there was a crash last October…did some of these Bears miss that call?)
A veteran stock trader friend of mine noted on Monday the large percentage of BEARS on the Birinyi Poll…it is these Bears who continue to fuel further rallies each time they stumble over each other to cover on ever precious shares of stock! -Ace