With the back-and-forth trading continuing and volatility perhaps topping off in the correction that began in January, stocks are up this week around 2% in both the US and globally. We are at the same points as last week with the Core Indicators. Cash Comparison is Neutral, but it flipped to Negative a couple of times before coming back to Neutral. Cash has risen above the Global Stock index, but the difference between the two is narrowing. We would now look for the Global Stock Index to rise back above Cash and the spread between them to widen. This correction is a healthy washout of risk that should likely serve to refresh the existing Bull Market cycle, and the more severe the correction, the better the buying opportunity could be in our opinion.
The Tactical Indicators are both Neutral but seem to be improving this week. The 10-week has now moved to the 46% level, which exceed the previous higher X column level of 44%. We are seeing a series of higher short-term highs on the chart within the correction, which is encouraging that the major Bull cycle may be likely to continue. The Overbought/Oversold Indicator has now held at about 2.4% below the Bull Trend Average with a more significant bounce in the MSCI All Country World Index off the psychological support of 500 to over the 510 level. The Oversold levels are rising in the channel. We may have some more downside to go through in the correction, but this could be it for the near term. There is no way to predict, so we will watch the Indicators to see what the next steps are.
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