LONG TERM GLOBAL HEAD AND SHOULDERS TOP LIKELY IN PLACE
A bit of economic news sparked a minor rally on Tuesday. The Dow touched a new 4 year intraday high and the financial news media celebrated the moment with banner headlines:
In spite of the fact that not one market index anywhere in the world even came close to confirming the new Dow high, market participants have greeted the move with unanimous, optimistic glee. The only thing missing was party hats and streamers. At this point in market history, virtually no one is even interested in hearing about any kind of top in any time frame and no market analysts are entertaining the notion. The bullish psychology rivals that of the 2007 top.
But the real news of the day was the intraday reversal from the high. There was a total reversal from high in Small Caps, Global Market Index and Nasdaq. If the session hadn't come to a close other indices probably would have followed. Apple reversed from a 2.1% gain to a .4% loss.
On Wednesday the market gave us an aggressive sell setup after
a clear B wave rally which ended with an intraday reversal and
failure back through the apex of a rising wedge formation:
Chances are high that a significant B wave has completed and
that a break from a multi-month Head and Shoulder top is nearby:
But the more important view is longer term and global. A survey of world markets shows that, outside of the US, markets have been in the process of forming a multi-year Head and Shoulders top since 2010:
A survey of the financial news media and popular blog sites finds virtually no bears or bearish market analysis. The analysis contained in my latest BullBear Market Report suggests strongly that not only have we seen an intermediate term top but also a long term top. According to my currently preferred scenario, the rally off the 2009 lows actually ended in February 2011, and the rally off the 2011 lows has been a B wave countermove. That has terminated or is close to doing so and the Major C wave decline is either in progress or soon to begin.
Let's recap some of the important market turning points leading up to the current market setup:
READ THE FULL POST HERE:
http://www.thebullbear.com/profiles/blogs/long-term-global-head-and-shoulders-top-likely-in-place
Go here to read the full BullBear Market Report:
http://www.thebullbear.com/group/bullbeartradingservice/forum/topic...
Need some help staying on the right side of the markets? Join the BullBear Traders room at TheBullBear.com. You'll get this kind of timely, incisive, unbiased stock and financial market trading, timing, forecasting and investment technical analysis and commentary daily. It's free to join, no credit card is required and if you like my work you just make a donation at the end of each month.
No comments:
Post a Comment