I am rescinding the comments I made last week about the long term trend. The Fed’s commitment to maintaining a bullish trend in stocks is now in doubt, and the long term indicators on the market index charts are ambiguous.
The outlook is rife with uncertainty. We don’t know when or if the Fed will re-deploy its tactical carpet bombing of deeply embedded, indigenous bearish forces.
It’s like the Viet Nam war. The Fed has overwhelming firepower, but it may not be committed to using it because of the astronomical long term cost fighting an entrenched enemy. We need to watch to the technical indicators closely to try to determine what each side is doing and will do, and which might have the upper hand.
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