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Those looking for a big breakdown in the S&P might want to take a good look
at attached weekly chart of futures. We've been in an 80+- point
consolidation range for about two months now and the market has held the
range in spite of some bad news including a big spike in rates. We have yet
to take out the 1210 low w/e Jan 15 much less the 1147 low w/e Dec 18. Note
also some of the similarities to 1996.
While one should not dismiss the possibility of a breakdown, one should also
keep in mind that time in consolidation is a substitute for depth of
correction. There is a very real possibility of an explosive breakout
running several hundred S&P points before any truly deep correction occurs.
The market will tell us which direction it prefers when it is ready.
Earl
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