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WEEKLY CHARTS

DJIA: Weekly support at 11675 and 11480. Resistance at 12250.

DJTI: Weekly support at 4600 and 4200. Resistance at 5000.

SP500: Weekly support at 1360/55 and 1325. Resistance at 1395.

NASDAQ: Weekly resistance at 2400 and 2425. Support at 2320 and 2300.

HUI: Weekly support at 280/275 and 310. Resistance at 350.

OIL: Weekly resistance at $61.50. Support at $57.50.

The zero line has been penetrated to the upside, and that is bullish. However, the negative divergence suggests that investors ought to be rather flexible at this point.

The BSEs are rising, and that is bullish, but the pattern is suspect. Don't be surprised if equity prices peak by the end of the week.

The TOs are rising, and that is bullish, but the pattern is suspect. Don't be surprised if equity prices peak by the end of the week.

The trend is UP for NASDAQ.

The trend is UP for the SP.

SUMMARY

For last week we said: "After today's and yesterday's price action we can safely conclude that--at the very minimum--half of the scenario#2 has been played out. Going forward, the rest of the scenario can unfold in three different ways which are illustrated below and are labeled as 2a, 2b, and 2c. In sub-scenario 2a, the major indices will experience a minor pullback over the next day or two, which will be followed by a resumption of today's rally. In scenario#2b, the major indices will reverse to the downside, and over the next 1-3 trading days they will make marginal new lows--just to fool the bears--and then they will reverse again, this time to the upside and they will go on to make marginal new highs--just to fool the bulls! In scenario#2c, the major indices will reverse to the downside over the next couple of days, they will violate support, and by next week they will end up at the first downside targets. The first two sub-scenarios are the most likely.

Also please read: "Market Timing for 11-13-06"

For the week of 11-13-06: Last week's action allows for a rather brief comment; the indicators are pointing up and thus, more upside action could very well be in the cards throughout the week. However, both the chart pattern and the negative divergences from the technical indicators strongly suggest that a top of some sort may be in the making. Don't be surprised if equity prices peak by the end of the week.

Ike Iossif

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