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Another day and another late-day rally. I know folks think it is fixed or being manipulated or whatever. What I see, despite the market being overbought, is that each time we sell off, the selling dries up. It has been a constant theme in the market for weeks now.

So perhaps what transpires is that the selling dries up and as soon as we start to lift a bit, the shorts rush to in to cover. I'm just speculating on this because surely I have no idea.

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What I


know is that the put/call ratio was high once again, and was that way all day. So you have a combination of selling drying up on the downside and folks leaning bearish. When you consider that the last three out of four days the market has been down, it's not so out of character for folks to start seeing a pattern and leaning bearish.

Yes, the indicators say we should go down, but each time we do, the selling dries up. Since three out of the last four trading days have had negative breadth, we have a positive and a negative. The positive is that if we keep this up for another several days we'll be oversold, while the negative is that the McClellan Summation Index turned back down and did so without making a higher high.

On Monday, I noted that the Dollar Index should run into some resistance in the 81-ish area and then might just come back down to give us a right shoulder of a head-and-shoulders bottom. You might recall last week I thought the dollar was oversold enough to give us a pullback in gold, too.

I see gold has come down to an uptrend line and ought to bounce from here. I suspect in the end we'll see gold fail the first time up, perhaps around $970-ish, but for now I'd say gold is inching toward being oversold. Of course you know I would prefer to see it break the uptrend line and shake out the weak holders, but I doubt that will occur right now.

As for oil, on a day-to-day basis, I don't see anything in particular as it has resistance around $70 and support around $65. However, I think getting through $70 and staying there is going to be quite difficult at this point. If we look at the weekly chart we can see there is a big downtrend line that comes in around $70. I expect oil will begin to struggle, although I'm not quite convinced it will come down just yet.

As for natural gas, how many times are we going to be shown that chart of oil relative to natural gas? Yes, I know on a relative basis oil is expensive vs. natural gas. But I did notice something about the long-term naturals gas chart. If you count the time between those spikes on the chart, you'll see they have come in two-and-a-half- to three-year increments. There is more to a chart than just the time frame, but I found it curious that natural gas seems to have a major spike up every few years and we had one just about a year ago.

Perhaps it means that natural gas can rally but we might have to wait until next year's hurricane season for a real spike up in natural gas.

For more explanation of these indicators, check out The Chartist's



Helene Meisler writes a daily technical analysis column and Top Stocks. For more information,

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. Meisler trained at several Wall Street firms, including Goldman Sachs and SG Cowen, and has worked with the equity trading department at Cargill. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. She appreciates your feedback;

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