Dow Theory Update for August 25: SPY continues making higher closing highs unconfirmed by the Transports and Industrials

No changes on the precious metals front

US STOCKS

The chart below says it all. Only the SPY has broken up the blue horizontal line (primary bull market highs):

The Industrials and Transports remain below the primary bull market highs

 

Hence, we cannot declare the second reaction finished and the primary bull market reconfirmed. Thus, if the stocks indices started to go down in earnest and jointly violate the secondary reaction closing lows (red horizontal lines), a primary bear market would be signaled.

So we still have to wait and, in spite of the SPY’s action, it is too early to proclaim the primary bull market as re-confirmed.

The primary trend remains bullish, as explained here, and more in-depth here. 

The primary trend was reconfirmed as bullish on October 17^th, 2013, and November 13th, 2013 and March 7th, 2014, for the reasons given here, here and here.

So the current primary bull market signal has survived three secondary reactions. Will it survive the fourth one? Confirmed higher highs will let us know.

The secondary trend is bearish, as explained here and here.

Sincerely,

The Dow Theorist