Editor's Note

The three-week rally is running on borrowed time. While I do not expect any consolidation to be severe, we are likely to have some prolonged weakness soon. The markets rarely post more than three weeks of gains without a weak of consolidation. We are due. The rebound from the opening drop this morning was nearly perfect and the 176-point Dow drop was erased by noon. While that was an outstanding performance, it was too calm and neat. There will eventually be a longer decline. It may not be materially lower but it needs to be somewhat longer rather than a three hour dip. Investors need time to make decisions and decide to take profits and move into other positions. Three hours is not long enough.

 

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