I wanted to discuss yesterday again because I found the one sidedness of the market puzzling. As I said yesterday the market lacked buying but even had less selling. As Mr. Wyckoff says one of the reasons to read the tape is to define the intentions, thoughts and plans of those who move the market. So why was there no selling? It is because the proverbial"they" are all thinking acting and doing the same thing. They are playing the carry trade, both here and overseas. Part of the carry trade is a declining dollar(exchanging cheaply borrowed dollars to buy foreign assets.) What the dollar's decline meant was that the carry trade was alive and well. The game goes on. The only reason to sell is a threat to the carry trade as it is financing ever increasing prices for a host of assets, not just domestic and foreign equities. The bullish sentiment then in the only survey that really counts, the behavior of prices was close to 100%.Because these are very highly leveraged positions, a move in the opposite direction will be explosive. This kind of unanimity characterizes the final stage of a move. As a result, I believe this is the last rally of the move that began in March. I am going to end here because I do not want to say anything else that might interfere with the simplicity of this message.
Tomorrow or Thursday I will show again how the bull move is seemingly over for large segments of the market. Look at FAS, DRN, TNA. The last is an especially beautiful chart with 3 1/2 months of topping action.
