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David Rosenberg isn’t going down without a fight.  The staunch bear believes the market is looking “toppy” and is displaying many of the characteristics of the 2007 market highs.  In a strategy note this morning, he notes the declining rate of change in the S&P 500:

“The S&P 500 has basically been hovering around the 1,100 threshold since October 15, getting as low as 1,042 and as high as 1,150 in what can only be described as a tight 10% band. (As an aside, the 13 week rate of change for the S&P 500 has swung to negative territory.) It has split the time above and below the line almost perfectly evenly as well (52% above, 48% below). We can understand the emotions involved in such a prolonged sideways band — a down move to 1,080 triggers calls for a correction, while moves up back to 1,120 prompts calls for a new high coming around the corner.”

He says today’s market is very similar to 2007 when we hovered near the highs for several months before tipping over.  He claims the economic data supports a market top here:

“In a secular bull market, a six-month trading range can be viewed as a pause that refreshes. But in a secular bear market, it more than likely reflects a classic topping formation, as was the case in the spring and summer of 2007 when the S&P 500 also flirted with the 1,500 mark for as long a period as it has hovered around the 1,100 threshold since last fall. Keep in mind that similar to 2007, we are starting to see some fraying around the edges in the latest set of economic data releases — jobless claims, housing starts and sales, core goods orders and shipments, construction, ISM and consumer confidence.”

Source: Gluskin Sheff

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