So we had a correction to the upside in the U.S. Of course some would say (sorry, not "some" but nearly "everybody") we had a correction to the downside and now we are again in the uptrend.
Maybe... as the legendary trader Jesse Livermore once said that the stock market is constructed in such a way to fool most people (me as well) so everything could happen.
But let me introduce two charts, which seem to confirm my stance. The first one is a short term look at the U.S. stock market:
The lower chart shows a 10 day simple moving average of the NYSE advance - decline issues indicator. This is one of the best short term indicators of selling and buying pressures at the U.S. stock market. Presently the indicator says that we are in the short term selling zone.
Now, let us look at the long term indicator:
This chart shows the behaviour of VIX (VIX measures the stock market volatility). Looking at this indicator in the long term we can spot that at inflection points it shows divergencies with the stock market. For example in 2009 this indicator was rising while the stock market was falling - shortly after that the stock market started its long bull run.
Presently, similarly to 2007, it is showing the negative divergency with the stock market which points to the incoming problems for the bulls......