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...it will be very important that we see a character statement by the bulls next week or the current uptrend from the June lows will have a hard time continuing past the middle of this month.
And a character statement was heard by all on Thursday as the bulls stepped in when they were not only needed, but expected to do so per our ongoing August blueprint. Looking at the NYSE related advance/decline line charts this week and one would think that, with new all time highs being registered in all of the charts in place, it was a very good week for the bulls. In fact, even the NYSE Common Only advance/decline moved to new 4 month highs after finding snapback support over the last two weeks of August. So in this respect, we can also say that breadth of market did indeed confirm the breakout to new price highs seen in many of the major market averages. But as we have been talking about in the chat room, the key to being able to extend the rally beyond the mid September period comes with whether or not there's been enough energy to move the breadth and volume McClellan Oscillators above their August peaks. Well, I'm happy to say that the NYSE Composite and the MID breadth MCO's did indeed move to new highs on Friday, but we still have a little more work still yet to do on the volume side. So although it's likely that we're going to rally well into the end of September now based on breadth participation, it's still important that we see the MCO's move to higher highs so that we can extend the time needed to complete this same pattern well into the end of October/beginning of November period. The precious metals arena also had a good week with gold now up 3.7% and silver up 10% since our buy signal on August 26th. However, we do have some near term problems with the XAU advance/decline line still having its issues moving above the overhead resistance area seen on the chart, but the Precious Metals advance/decline line counterbalances this with it moving to higher highs confirming the move in gold. Aside from any near term back and fill that we might see to correct this inconsistency, the overall rhythm of this asset class remains positive for now. All in all then it was a good week for the bulls, and depending on what may happen next week, any strong follow through will likely push prices higher for the next couple of months, with an outside chance into the 1st quarter of 2013. Have a great week of trading! US Equity Markets : US Interest Rates : US Real Estate : Precious Metals: Australia: England: Germany: __________________ Dave's LinkedIn Profile Technical Watch Twitter Page Technical Watch Facebook Page "As for it being different this time, it is different every time. The question is in what way, and to what extent" - Tom McClellan "An economist is someone who sees something happen, and then wonders if it would work in theory" - Ronald Reagan "What we see depends mainly on what we look for" - John Lubbock "The eye sees only what the mind is ready to comprehend" - Henri Bergson “Answers are easy; it’s asking the right questions which is hard” - Dr. Who - 1977 "You know the very powerful and the very stupid have one thing in common - they don't alter their views to fit the facts, they alter the facts to fit their views (which can be uncomfortable if you happen to be one of the facts that needs altering)" - Dr. Who - 1977