LET'S LOOK AT JANUARY

You will have to enlarge this chart to get a closer look at what I have displayed here. As far as I can tell there has been a pretty consistent 18 week cycle top to top in the stock market going back for quite a few years now. It does not get every top of course, but by and large it has gotten most of them, or at the very least price has declined when these dates have arrived. Ironically, this week indicates one. I did this from years back going forward, so I did not curve fit this to today's date. I was in all honesty surprised to see one right here. Now that I have displayed this and talked about how accurate it has been, I will say that I doubt this one will be spot on. There is so much going on with year end, and everything else I have outlined in here, that a decline before January would truly be a shocker.

Nobody should ever trade just off something like this alone anyway, but it is just a tool to keep us focused on possible windows of time for action. Although seasonals tend to have their periods where they stray quite a bit, there have been down moves in January enough in recent years that we have to at least pay attention during that month. There has been alot of artificial inflation in the indexes this year, so maybe come January we get a little bit of a break to see if the fawn can stand on it's own legs. Of course if he starts to tip over, then the PPT comes back in to support him. Sounds reasonable doesn't it?

We have gotten really extended in price, but that often happens in strong trends, so that is not a reason to get too excited about selling. I learned early in my career and in a painful way, not to stand in front of things like what we have going on here. It is a lesson I still learn from time to time.

Here is a chart showing that 5 out of the last 6 years have had declines in January.

Ironically the one year that did not have a decline in January, was the year of the major top. As I mentioned the other day there are Gann people talking about Jan 11 as a top date. Of course we don't know if they have had 25 other dates that have come and gone the last 6 months that have been wrong, a high probability. In any event, it might be worth your own individual studies to determine if there is a window for action coming. It does seem to me there is enough to at least take a closer look at things. This whole thing is going to come to an end suddenly when it does, and there will not be a banner being pulled behind a plane alerting you to it.

The next chart is an individual stock that has about as much divergence in my indicator as I ever see. It also lines up interestingly with the Oil complex, which seems to be setting up for a sell signal. This might be a good way in the equities market to play a oil decline other than etf's if one occurs.

We are still making higher highs here but situations like this often turn on a dime.