Follow The Message Of The Market, Not Emotion
Eric De Groot | Feb 19, 2015 07:34AM ET
While Dow Industrials, SP500, and Russell 2000 at or near all-time highs, broader indices, such as the NYSE Composite Index, define an extensive consolidation/causing building phase since July 2014 (chart 1). REV(E)'s upward bias, a series of higher highs and lows within cause, reveals the accumulation of energy that will help price jumping the creek of cause (blue box). Review of US Stocks or Review One-Time, analysis of trend, leverage, time/cycles, and sentiment, will help 'time' this transition from consolidation to mark up.
An upward drift within consolidation into an early April high is still a possibility. Let the chasers blindly follow strength or weakness. Let the message of the market, not emotion, manage risk.
Chart 1
Chart 2
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