Are we tied to a market that will continue a smooth ride up for some time to come? Sure feels that way. Ole Ben keeps printing money, the little guys (retail investors) keep buying the market back up after every dip that results from the big guys' selling, the economy is holding its own, the market is moving in a near-perfect immediate-term trend and MIPS is following it to perfection, etc. See Graph #1 immediately below.
So, what could go wrong? There are many fundamental values that could could derail the market, but that is outside of the scope of this blog (and you can read about that all over the Internet).
From a purely technical standpoint, two things are very dangerous.
1) The first is the 13-year Triple Top that we discussed in the previous email below (see the very last graph).
2) The second is closer to home. In Graph #2 below, you can see the potential formation of a near-term perfect
double top. If the SPY fails at breaking 159.7 to the upside and heads down, this could represent (a) a dreaded
sideways pattern at best, and (b) a double top worst case.
As always, let's wait for MIPS to tell us what do do.