Greg Guenthner

Stocks have hit the snooze button…

For almost two weeks, the Dow Industrials have traded in a very tight range.

How tight?

Well, the difference between the Dow’s intraday high and low has been only 1.35% over the past 13 trading days. That’s the lowest spread since late 1986, according to Bespoke Investment Group.

Of course, the 1986 market pause was one of historic proportions. The low-volatility coil led to a spectacular run-up in 1987 that didn’t slow down until the epic Black Monday collapse that October.

Which way will the Dow break this time around? Is it headed for upside mayhem, or meltdown?

If the broad market has any say in the matter, a breakout to new highs is in the works…

The Broad Market's New Milestone

Yesterday, the Wilshire 5000 — an index that consists of all stocks trading in the United States — broke free of the bear and posted all-time highs. Few people watch the Wilshire — even though it’s one of the best broad market barometers out there. With little fanfare, it breaks free to blue skies…

As for the major indexes — they won’t stay stuck on pause forever. Something will have to give one way or another. As of yesterday, the Dow sits about 1.5% below its all-time high close of 14,164. The S&P has a little more work to do. It’s 3% below its all-time high close of 1,565.

If the Wilshire is any indication, the S&P and the Dow will follow to their respective highs in short order…

Best,

Greg Guenthner
for The Daily Reckoning

Greg Guenthner

Greg Guenthner, CMT, is the managing editor of The Rude Awakening. Greg is a member of the Market Technicians Association and holds the Chartered Market Technician designation.

Recent Articles

How to Invest in a Strong Dollar World

Chris Mayer

Our friend Jim Rickards and founder Addison Wiggin believe the dollar will soon meet its demise. Chris Mayer, on the other hand, thinks the dollar will only get stronger this year and next. We'll let you decide for yourself. In this featured essay Chris lays out his train of thought and a guide for investing in a strong dollar world. Read on...


“How to Get Rich” is Not How You’d Expect

Chris Mayer

The first thing you might notice about the life of Felix Dennis is that he devoured crack cocaine during massive orgies with hookers at his mansion. Yet despite his penchant for sex and blow, he admitted, "making money is the one addiction I cannot shake." And thankfully, he wrote a book about it. Chris Mayer explains...


Bitcoin: Buy Now or Forever Hold Your Peace

Chris Campbell

Bitcoin has been pretty quiet lately. But that doesn’t mean big things aren’t taking place behind-the-scenes for the digital currency. In today’s Laissez Faire Today, Chris Campbell pulls back the curtain and shows you how bitcoin is quietly slipping into the mainstream. He also shows you why now could be the time to buy now, or forever hold your peace. Read on…


Here’s the Market’s Next Hot Sector…

Greg Guenthner

According to my friend and fellow technician Ryan Detrick, The Russell’s quarterly win streak of 8 is the index’s best performance of all time—even topping two monster runs in the 90s. So if small-caps are slipping, where can you find the next hot sector? The answer might surprise you…


Maestro
Will The Swiss Vote to Get Their Gold Back?

Ron Paul

The Swiss gold referendum in November is far more important that many people realize. The outcome could quell or confirm doubts about the amount of physical gold available at the New York Fed. And that could send the price of gold higher by multiples. Dr. Ron Paul brings you up to speed on what's happening in Switzerland...