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Blow-Off Bull Approaching Terminal Reversal...

Another week of reasonably constructive bullish action that did nothing to remove the danger of a terminal reversal. The Transports breaking to new highs remain the lone confirming sign of my divergence/confirmation indicator, with volume and ADX momentum remaining in the red arrow negative divergence camp.

Lot's of tech earning to come in the next couple of days - IBM, AAPL, GOOG, MSFT - with the reaction to those likely to break this chart set-up one way or the other.

The red line for NASDAQ and volume breakout remains the key - and things look super bullish if we get such bull confirming action - while support at point b in the chart remains the "bears have won" trigger point.

We remain in a blow-off rally that will likely morph into the next Great Bear once complete, and those red lines need to be taken out for the current blow-off to bloom into its full potential. A 1999-style mega bear flush-out remains a very real possibility if the bulls can deliver some acceleration to the buying.

These High Risk years are not for the faint of heart, as the bulls and bears push the market first up then down, till a definitive victor is declared. We get closer to the latter by the day.


Some ETFs I am long at QLD, XHB, EWG, EWH, EWW

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Disclosure: I am long QLD, XHB, EWG, EWH, EWW.