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So, for now, let's continue to give the bulls the benefit of any doubt out there for next week as it will be up to the bears to show some better conviction in their bias if they expect to get anywhere fast.

Although the large cap indices were down slightly, the rest of the market again closed higher on the weekly time scale with the Mid Caps and Small Caps closing at new all time highs, while the NASDAQ Composite and NASDAQ 100 both closed at 13 year highs.

Looking at the breadth chart array this week and we see that the NYSE Common Only advance/decline line, along with the NYSE Specialty CEF and DAX advance/decline lines, all remained well above their advancing trendlines. Meanwhile, the NYSE Bond CEF and REIT advance/decline lines both took a breather and moved lower. This weakness in the interest rate sensitive issues added downside pressure on the broader NYSE Composite advance/decline line after it completed a technical snapback to its 2nd fan formation line as it continues locked within an intermediate term high level consolidation (see cumulative charts array). Given this lack of synchronicity between the broader NYAD line and its derivatives, along with the breadth and volume McClellan Oscillators and their respected McClellan Summation Indexes, the expectation for the next week or two will be for a high amount of chop in prices until one side is able to take better control of the overall action.

Finally, the Precious Metals and XAU advance/decline lines both continued weaker for the week with the XAU advance/decline line moving to its lowest levels since 2005. Until we see better structural characteristics in both of these money flow lines, it remains highly prudent to step aside from any long positions in the gold and silver complex.

Have a great week of trading!

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