The Theoretical
Outside markets were a little on the bear side today, with copper hitting a 62% retrace from the 2011 high to the 2016 low. No confirm of a major top yet, but copper is up 75% over the major low last spring. Crude is also backing away from $47, with rig counts rising along with stocks.
Other markets were less clear, with the $ threatening to make a new low, but did not, and grain markets were mixed.
Our theoretical and calculated high/low for this year has been 7535/6185, assuming the balance sheet is right. And that assumes a 10% swing, high to low, and there is a good chance either side gets punctured. Remarkably, our theoretical low is 99.9% of the actual low. Today's high of 7520 is 99.8% of the theoretical high, but both of these are assuming a simple 10% variation around the avg. And of course, the balance sheet could still change, but we think not much.
Technicals
Today falls on a long term Fib 233 count from the major high last Jan. The first indication of a major high would be a close below today's low of 7420, and Friday's low of 7400. Divergence between new highs of 10/28 and 11/23 and today has developed between price and momentum. To confuse matters, the seasonal history is bullish, and this calls for a high on avg date 1/02.
