Since you asked,... the charts in 2000 and 2007/2008 showed the uptrend was weakening. Yes there was an absolute top noted in both those instances but the top showed a weekly negative divergence on MACD (blue downward slanted line on both those charts). My goal is not to call the absolute top. I may recognize a top in an uptrend but I choose to not add to long positions. I also choose not to short in a short term top on an uptrend but instead wait in cash. Also, as you can see on both 2000 & 2008 when the uptrend was being broken the Weekly MACD was falling as prices got higher (negative divergence) in addition to breaking below the ZERO line (blue ellipse) and at the same time the trend line was breaking while the weekly EMA 50 was curling downward. We have none of that in this chart. Until/If/When the 2000 level is taken out AND all of these parameter hold true on the current chart then all dips should be bought with the assumption that the trend will continue and we are entering a time of LIKELY retracement of prices to about 2200-2250 level. In fact, there is
NO negative divergence to even suggest that the trend is tiring out here. In fact it is rising right now. Until proven otherwise the trend is intact but we likely have put in a short term top. So I choose to wait in cash rather than short this market. The 3rd chart shows another perspective of why 2200-2250 level is likely support for current uptrend (pink circle). Could it beak lower?,...yes but I doubt it. I choose to re-evaluate each day and make changes but for now I am waiting.
2000
View attachment 171371
2008
View attachment 171372
20 year chart
View attachment 171373
My $0.02,
Eganon
