Sponsor Forex Brokers $ Index, Upside Still Not Complete....

$ index is down from the Oct 28th high at 87.85 but with no signs that a more important top is in place pattern-wise, is seen as a correction and with eventual new highs above 87.85 after. Also, yesterday’s bullish "false break" of the bull trendline since late Sept (see daily chart below), adds weight to the view of further upside ahead. However, there remains some risk for another week or 2 of wide consolidating before the new highs are seen. Reached the buy target from the Oct 22nd email at 84.75 and for now, would stop on a close below the bullish trendline from late Sept (not including yesterday’s spike, currently at 84.75/85). Note that a break below there would not abort the view of new highs, and would be looking to rebuy at lower levels if taken out. Nearby resistance before the 87.85 high is seen at 86.20.

Longer term, the market is nearing overbought after the sharp gains since the March low at 70.70 (see weekly chart/2nd chart below). However, there are no signs of even a near term top and suggests further gains above, but there is some risk that further upside may be limited. Note too that longer term resistance is above there at 90.00 (38% retracement from the July 2001 high at 121.00) and a number on bigger picture cycles in the financial markets reverse in the mid Dec timeframe. So for now, would have a bullish bias but will be looking for signs of a potentially important top (for at least 3-6 months) on a move above 75.90, and especially on an approach of the mid December timeframe.