I’ve spoke about the potential head/shouder on the Dow 60 min, but it could also be a rounded top formation – either way – both are bearish. Even after what most would perceive a bullish week on the major indexes, we’re still making lower highs on the Dow.

Here is a big chart of this so you can see the levels better. It’s amazing how it bounced off that support line around Sept 20 (indicated by black arrow) and then was initially rejected after we broke the neckline, but when it reversed a big rally ensued. Add in the fact that the RSI hasn’t breached the 70 level and all I see is a weak market. In fact, going over the charts this weekend I am becoming more bearish and believe a big move to the downside is coming.

Maybe it’ll be a wash…or maybe it’ll be the real deal, but I don’t see anything that would lead me to believe we going higher.

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One Response to “Rounded Top On Intraday Dow Chart”

  1. No Tribe Says:

    I was looking at a SPX chart earlier, and would make a graph if ToS were not down once again (they are making me leave), and you can see it above a bit in the Dow as well. Basically, a W in the middle and W’s on either side of those– the W in the middle being smaller than the other two doubles. And you know where I am going with this symmetry, yep, we are going about straight up now with the retrace. On the Dow, I am watching IBM, which is going to be the leader there, and a new high will be the tell.

    The meme I mentioned earlier, you can see already now with the talking news (JPM is gonna have made a ton of money, GOOG as well, and AA, I don’t follow but prob is fine). The guys I read on tech earnings are talking about Q3 being one of the biggest ever. Yea, where does it go from here, but amidst what we are going to see, its not going down:

    SAN FRANCISCO (MarketWatch) — U.S. stock investors are looking to quarterly earnings results, which ramp up next week, as a distraction from Europe‘s debt wrangling and reason to extend the past week’s gains.

    U.S. Week Ahead: Google, Alcoa
    Next week marks the unofficial start to Q3 earnings season with Alcoa late Tuesday, J.P. Morgan Chase and Google on Thursday. Plus: all eyes still on Europe, and September retail sales and October consumer sentiment is released next Friday.

    Results from the trio should offer investors a sense of whether companies have been able to override the economic and political challenges of the past three months, which have made some companies and consumers more reluctant to spend.”

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