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Squawk Evening Update: The Last New High?

We’ve been waiting for several days for the DJIA to either break above last Wednesday’s high, or break down below 10,994.  Today prices finally chose the former option.  Our game plan is to now look for a completed five waves up that we expect will end the months-long upward correction we’ve seen and lead to lower prices.

Trying to count the slow and steady rise that prices took throughout the day requires drilling down to one minute bar interval.  At that level of detail, there is the ability to count the move up as complete.  However, we have to be careful relying on what we see from such small degree moves.  Equity futures have sold off considerably following the cash close, and while a lot can happen overnight, this is yet another sign that the top may be in.

We remain committed to seeking confirmation of a turn before taking on additional long-term short positions and we’ll have charts to show what we’re looking at and confirmation targets in tomorrow morning’s briefing.

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