[newsletterchapter2 title=”GENERAL MARKET COMMENTS”] Global Equity Markets continue to exhibit generic, albeit waning, strength as the Liquidity Gestalt matures. This is Amazing even as Geopoliticals have become overtly negative and even, viral. Moreover, the DAX, which was a de facto leader, has faltered badly but some Asian Indices are seeing renewed strength.
The pattern preference was for, “Rolling, diverging strength for much of the Summer.” Equity behavior has finally become mixed but no real Change has occurred. We allowed that minor Corrections could be followed by some upside into Mid-Late August. If an overt and “Phat” High occurs, a potentially dramatic decline may manifest. Repeat: “This is still a Manipulated Market.”
The 7/3, DOW 17K, Cupcake Crumble and the 7/28 new high Reversal are clearly part of a Topping Pattern. We allowed that: “There may be a sweeter Sell spot yet to come.” That might be some sort of triple top or right shoulder over the next few weeks. It still argues for Patience over the next few weeks.