other hand, the DJIA, DJTA, and S&P 500 have not closed above their highest closing price levels since August 22, 2002, so the Dow Theory remains Bearish, though not by much now. Also, momentum and sentiment remain quite overbought. So, this may not be a time to throw all caution to the winds and enthusiastically join the running of the Bulls.
Of course, there is always the possibility of a Bull Trap, a false breakout that panics the shorts and hooks the longs, to be followed by a quick reversal. Also, Friday was the end of the month, a time when certain derivatives strategies are unwound and, thus, a time for possible market distortion.
And then again there are those cycles. This still would be a good time for a turn in the March-May uptrend. Robert Prechter and Steven Hochberg (www.elliottwave.com) note that for the DJIA, the decline from the all-time high on 1/14/00 to the low on 9/21/01 lasted 616 calendar days, which is a Fibonacci 610 plus 6 more. An equal time span of 616 calendar days from 9/21/01 takes us to 5/30/03. One day later, 5/31/03, is a Fibonacci 233 calendar days from the low of 10/10/02. Also, 5/30/03 is a solar eclipse, which sometimes coincides with high stock market volatility and trend turning dates. Generally, we allow a few days leeway on either side of such dates, rather than expecting precision.
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