Nasdaq Takes The Lead

 It has been about 2 months since the last red bar on the Elder impulse system, and in that time the market has gained almost 150 points. We;ve hsd several clusters of blue bars, which would normally warn of a trend chane, but not so far. This one, however, soes look a little more ominous, and the technical indicators are creeping down. At this point, I am expecting a correction, but I don't expect it to drop below 1130 based on the lack of distribution days. Unless there is something dramatic in the news (such as an election surprise) or a big disappointment in QE (I think expectations are something like $4 Trillion now), this could be the last decent buying chance we get this year.

 The Nasdaq is a total non-confirmation of any trend change here. It is still below resistance, and may pull back nominally, but there is absolutely nothing here for the bears.

 This is where the bears' attention should be focused. The Russell is once again lagging very badly. I put a price relative line between it and the Nasdaq. It has been under performing the Nasdaq since April, but has also been trying to reverse that trend, but right now it's not looking good.

Crude oil is still is a bullish pattern, despite a couple of sell signals given. If this breaks out past 85, 100 should be easily attained by the end of the year.

Gold is also on a sell signal, including today, but still above the 50dma, so we could get a reversal here soon. MACD is still downward but flattening out, and RSI has worked off it's overbought status and could get a bounce here. Recent history suggests gold will have a longish consolidation here, but i suspect recent history may not be the best guide here. We are entering uncharted territory.

Bernanke is set to announce QE 2 after the election. The market is setting up for something here, whether it is "sell the news" or "party like it's 1999" I don't know, but one ting is becoming apparent: you better make lots of those green pieces of paper, because they will be buying a whole lot less next year.

I will have the new highs update shortly.