‘US Bull Market Intact; Chances of S&P 500 Touching 2,700 are High’
there was no follow-through selling and they ended very strongly. That looks like it rejuvenated and reconfirmed the fact that the market was in an uptrend. The biggest concern that we would have right now is the age of the trend in the United States. It bottomed in 2009. The trend is almost seven years old. That is quite old based on the history of cyclical bond markets in America. That would be the concern we have at this juncture, the age of the trend.
FUTURE OF DOLLAR
What is the dollar chart indicating? Well, the emerging market currencies had an incredibly bad 2016 and a lot of them fell dramatically. Now, they seem to have stabilised and they have started to trend higher as have emerging market equities. The key exchange rate remains the euro. It has been trapped in a range now for two years, approximately between 105 and 116. We are still leaning towards the idea that the dollar will strengthen again but this is no longer a view you can be complacent about. You must understand it could go either way. Any gains that the dollar has had this year will likely be part of a topping process. The next significant move in currencies will be to see dollar weakness but that may be a story for next year.