Levitation Light ~ The Risk Averse Alert

Friday, October 22, 2010

Levitation Light

The market's hard turn south could commence any day now...


No holiday to explain today's thin trade. Yet light volume reveals there's little selling threatening levitation. So, some days more could pass before wave c finally is completed.

Same old, same old sees momentum (bottom panel) flattening in suspension — something of a trend prior to a periods of weakness since March '09 bottom.

NYSE McClellan

Underlying technical weakness continues building. Likewise, the McClellan Oscillator's behavior highlighted above seems entirely fitting the Elliott Wave count ... first, going into April top ... and now, coinciding with a corrective wave off late-June bottom.

The McClellan Oscillator's decidedly positive bias coinciding with wave a off late-June bottom is fading ... badly ... during formation of wave c. The way to the market's upcoming collapse, then, appears paved with misplaced complacency now seasoned with increasing underlying weakness.

Fast Money
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