10.21.04 - T-12 Days

Tick, tick, tick... The DJZ4 moved within 20 pts of its early-August lows yesterday and held. The US dollar continues to succumb to selling pressure while the Euro is at its highest level since mid-February after breaking out of a 7-1/2 month range last week. The US notes and bonds are also testing the 2004 high levels. So, with less than two weeks to go until the US Presidential election, will the US stock market break? That's not a constructive environment for the incumbents. Stay tuned, but it looks to me like an inflection point is very near. The DJZ4 needs a close above 9990 to stabilize, the USZ4 below 11216-11224 and the US dollar above 8740.