No material change since yesterday’s outlook, though I have outlined the two most likely short-term paths from here. Odds are good that at least a minor top is nearby, but it appears reasonably likely we’ll see slighly higher prices first. The chart below shows that as long as bulls can hold above 1382, they have a good shot at moving the S&P 500 (SPX) into the mid-to-high 1390’s.
The SPX hourly chart notes that both bull and bear intermediate possibilities remain alive. Worth noting: virtually none of my intermediate indicators have given buy signals yet and the intermediate trend is still technically “down.” The preferred count sees a correction beginning in the next few sessions, then (most likely) another leg up. (continued, next page)
In conclusion, it does appear marginally more likely that this wave has a bit higher to run short-term, but that it’s closing in on at least a minor top. There’s an outside shot this top will mark ALL OF Wave (4), but odds currently favor that there will still be at least one more leg up after the next decline.
On a lighter note, my middle son is in 2nd grade, and his teacher had him make one of those “Five Things I’m Thankful For” lists for Thanksgiving. Well, this gave me the idea to conduct a very scientific survey amongst bulls and bears, to find out what they’re thankful for. After several grueling minutes of sitting at my computer and writing down whatever popped into my head, I was able to compile two such lists by tallying up the responses of thousands of pretend market participants, who were asked to identify themselves as either bulls or bears. The resultant survey responses thus have a margin of error of only +/- 100%. Such is my dedication to scientific accuracy!
Below are the two lists: the first list is from the Bulls who responded to the survey (interestingly, more bulls responded than bears); and the second list is from the handful of Bears who took the time to fill out the survey forms (many of them noted that they were too busy canning holiday yams for their bomb shelters to respond):
Five Things We’re Thankful For, by: The Bulls
1. Ben Bernanke and his tireless printing press.
2. The Amazing Economic Recovery since 2009! Ha ha, we’re just kidding. We mean the printing press again.
3. Apple (AAPL). Well, at least we used to be…
4. Mario Draghi and his unwavering commitment to “save” the Euro, or whatever it is he’s doing over there (wink wink, nudge nudge, know what we mean?).
5. Hey, not fair! Why do we have to stop after only 5 things? We need this list to keep going higher and higher! On second thought… in 2007, people said our list was in a bubble after we reached 258,963 things we’re thankful for, and that list ended up crashing. We certainly don’t want to repeat our mistakes, so we’ll just end the list by saying we’re thankful for all the Central Banks. We’re pretty sure our list has now reached a permanently high plateau…
Five Things We’re Thankful For, by: The Bears
3. We figured we’d skip right to 3, since we made the mistake of shorting 2, and now we’re forced to cover at a loss.
Anyway, happy Thanksgiving! Trade (and drive, and eat, and deal with the in-laws) safe, and I’ll see you again on Monday.
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