QUESTION: Marty, you said the “main resistance stands for this week at 20505.” The Dow stopped today at 20504.41 and closed on the high. Nobody produced numbers like you do. The Dow goes up and the euro declines. I can connect the dots. Is this correct?

ANSWER: Correct. It is the capital flows and Europe is just not even discussed in mainstream media right now because they are far too busy always trying to undermine Trump in an outright war. Keep in mind that the 21,464 area is really the critical level during February. At this point, the Dow would have to close below 18,000 to sound any alarm bell. As I have been warning, domestic analysis just doe not cut it in this global environment.

Friday’s closing at 20,298.21 in the Dow was still bullish and the main resistance stands for this week at 20505. Exceeding that level and a close above it on Friday would point to an extension into next week. The top of the channel in the 20,700 area. Exceeding that level will warn that we could move sharply higher to the 21000-22000 zone. The major resistance starts at the 21,387-21,624. Keep in mind that the majority remain bearish and and most big funds remain under invested in equities. Therefore, we are looking at an amazing amount of money sitting on the sidelines.

The two key targets on the monthly timing level remain February and April/May. Keep in mind that normally this would unfold as two opposite events meaning a high in February should lead to an April/May low just before the French elections. We can see an intraday high extend into next week.