by Erik McCurdy, Prometheus Market Insight
On Tuesday last week, we noted the development of a potential cyclical trend sell signal and indicated that the latest short-term cycle low (STCL) would need to form before the sell signal could be fully defined. As expected, the latest STCL formed on December 16 as confirmed by the cycle low signal that was generated today.
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Due to the direct, historic intervention by the Federal Reserve during the past several years, the current cyclical top is long overdue and it could form at any time. The currently developing sell signal is the strongest indication of a potential cyclical top since early 2012, so it will be important to monitor stock market behavior closely during the next several weeks.
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