Turning Points | Andre Gratian | 2011-08-17

From Safehaven.com:

During the first four days of last week, stock markets around the world underwent one of their most chaotic and volatile periods in history, but on Friday, an eerie calm prevailed as trading appeared to return to normal. Has the schizophrenic market behavior really normalized, or are we simply in the eye of the hurricane? This is what we are going to try and determine in this letter.

It appears that the bull run is over and that a bear market has started but, technically this won’t be confirmed until the SPX drops below 1010.91 and makes a lower intermediate term low. It can take its time doing this — and probably will.

Arguing that we are in a bear market is enhanced by a six-month period of distribution between the 1347 and the 1370 tops which, on the Point & Figure chart, yields a downside projection of 879, and even lower (789) if we include the left shoulder of the H&S formation.

Continued

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