Posted by Richard Russell - Dow Theory Letters

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A brief excerpt of the lengthy daily internet comment by Richard Russell of Dow theory Letters. One of the best values anywhere in the financial world at only a $300 subscription to get his report daily for a year. HERE to subscribe.


I believe that it’s now widely taken for granted that we’re in a primary bull market. I’ve been in this business for a long, long time. And any time I feel that something in the economy or the stock market is a “lock” and is taken for granted, I say to myself, “Maybe but I want proof — proof in the market’s action.”

I’m in a difficult spot here. I know that almost everyone believes we’re in a bull market, but I’m not convinced. I still suspect that we’re in a counter-trend rally in a continuing bear market. I know this is now an extreme minority opinion, but minority opinions against the crowd, have always intrigued me.

The Dow hit a high on September 22, a high unconfirmed by the Transports. The Averages turned down from there. As of last Friday, the Dow had been down seven out of the last eight sessions. This took the Dow down to just above its 50-day moving average (which stands at 9458).

The Transports have been down eight of the last 10 trading sessions. As of Friday, the Transports had sunk below their 50-day moving average, which now stands at 3749. Unfortunately, there’s no way of telling at this time whether we are seeing a mild correction of the advance — or whether the rise from the March low is now in the process of topping out. The outcome to this puzzle is absolutely critical.

If both Averages can rally above their recent highs (for closings see below), the bull case will remain alive. If the decline continues and volume increases on the decline, the bear case will be enhanced. We’re living a great drama now.






Wall Street wisdom — “It’s easier to stay out than to get out.”
“Get out when you can, not when you have to.”


The 84 yr. old writes a market comment daily since the internet age began.  In recent years, he began strongly advocated buying gold coins in the late 1990’s below $300. His position before the recent crash was cash and gold.

There is little in markets he has not seen.  Mr. Russell gained wide recognition via a series of over 30 Dow Theory and technical articles that he wrote for Barron’s during the late-’50s through the ’90s. Russell was the first (in 1960) to recommend gold stocks. He called the top of the 1949-’66 bull market. And almost to the day he called the bottom of the great 1972-’74 bear market, and the beginning of the great bull market which started in December 1974. He loaded up on bonds in the early 80’s when US Treasuries where yielding 18%.