I have recently mentioned my concerns about stock market valuations. We are currently just 20 points away from the all time S & P 500 high of 1991, yet what have the markets been telling us over the last few weeks. On June 9th the S & P 500 was at 1955 and butting up against the top of the uptrend channel, a short term correction was expected. We basically had a 5 week sideways correction that brought the S & P 500 to the bottom of the trend channel. We got the expected rally off the bottom of the trend channel and it lasted for all of five days. We never reached the top of the channel (running out of steam) and subsequently we have broken the trend channel which could be the precursor of further market declines.

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Let’s have a look at a few stocks in the Dow Jones Industrial Average. It doesn’t look like a bull market to me! Perhaps we are topping?

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What do you think?

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