Tuesday, May 5, 2009

Is Dow Topping?

I'm always in search for recognizable patterns that can give me some clue as to what might happen going forward. One thing that I am always searching for is a neckline. I suppose that whenever a market breaks out of a consolidation period, we will see a neckline. Only when the head of the Head and Shoulders pattern is formed, that is, when the price falls from peaks to a bottom, can we have a better idea of what could be happening.

All I know is that the market has turned in a stunning performance to the upside. Everyone is starting to love the market and yesterday's surge could have been short sellers capitulating.

Not yet calling a top, although I am lightening up and buying a little more DXD. Only want to make you aware of what might be happening. A 10% drop from the current levels could be in the cards!

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