The DOW looks poised to drop momentarily, and the rest of the market with it. (Image)

Bugsy

Bugsy

89oh.jpg


(Excuse the mobile image shot)

Its currently triple topping on the monthly chart which coincides with a bearish divergence on the RSI. We're coming into the last week of the current monthly candle displayed and I think it will continue to finish out this candle strongly, but the signs point to a coming drop imo. Thoughts?
 
double tops and triple tops are a sign of counter trend strength.

which means that even if the drop comes it will be bought into.

look what happened after the double top....two legs down and then the up move.

Only one leg of the up move has been completed ....see chart the next leg will begin and dow 31000 will be a reality.....it is from there that a down move may start.

the rsi has to show bearish divergence since it measures relative strength....all this means is that the market was weaker in the range RELATIVE to the previous upmove. do you need an indicator to tell you that?

try to understand what the indicator means.
More on double tops :
the yellow lines show all the double tops that have FAILED: six, i think, in all only one double top,marked with a blue line was a success...but being a golfer ,i cannot count after 4.
so double tops have the worst percentage of success.
dow.png
 
Bugsy said:
89oh.jpg


(Excuse the mobile image shot)

Its currently triple topping on the monthly chart which coincides with a bearish divergence on the RSI. We're coming into the last week of the current monthly candle displayed and I think it will continue to finish out this candle strongly, but the signs point to a coming drop imo. Thoughts?
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Your way of reading chart is fabulous. We are all doomed soon, no?
 
humbletrader2016 said:
We are all doomed soon, no?
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why doomed? the next move will be to 31000 ...the bears are doomed

this is certain....unless some one kills Trump or Trump kills Trump.

or on the other hand the market may spike up... if that happens...this market wants to go up
 
humbletrader2016 said:
SO WHAT??? it's irrelevant to this thread. Read his thread's title before responding, especially the words "drop momentarily".
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When I say "drop momentarily" I mean relative to the time frame in the chart, which is monthly. Also, TA is not an exact science, and I'm just giving my own perspective as the gentleman above did. It's just my opinion which is why I asked others thoughts on it.
 
What do you think will happen if the Fed drops rates in July as expected by many?

Lower rates generally help the market (and zombie companies), but it would also signal weakness.

Iran is a wildcard.

re: TA
Obviously the market has been having trouble moving higher compared to last Sept., so the RSI will be dropping.
But you could also draw a bullish ascending triangle onto the chart.
 
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Context = trend up. Immediate context =17 sideways bars. Every push by the bears is bought. More buyers below. Price is staying way above the BO point of the previous sideways move.

I would be looking for a large measured move up once it breaks above the present sideways PA and holds above the present range. The size of the larger measured move starts from the BO of the previous sideways action bottom left of the chart move up to the middle of the present range (or the BO of the present range) then that measurement extrapolated upwards.

In addition, I would be looking for and capitalizing on smaller measured moves. For instance, once a successful bullish BO of the present range happens then I would measure from the bottom of the present range and extrapolate that upwards from the BO point of the present range. By a successful BO I mean any BO of the present range that has a PB that holds at or above the BO point of then range and then continues on up. I would go long and takes some off at first measured move and hold some for the larger measured move. I would also do a measured move from point of the BO to first PB and that extrapolated up from the PB.

Bottom line ..bullish...buyers below...odds favor BO to the upside...AT THIS MOMENT IN THE RANGE. However, the longer a range carries on as a range the odds become 50/50 the BO could be in either direction. The measured moves mentioned above are based on a successful bullish BO of the present range occurring fairly soon as it already has 17 bars in that range. If it goes on 30 or 40 bars in the range then odds are 50/50 on a BO.

And remember, 80% of BO’s FAIL. SO...any measured moves are contingent upon a successful BO first occurring.

If the the opposite happens (and it can) and the BO is soon south and successful, then I would be looking at shorting at least 2 legs down...and taking my MM’s south off that BO (i.e. top of the range to BO point at bottom then extrapolated down as the first leg) followed by a smaller measured move from point of the southernly BO down to first PB and that then extrapolated down from the PB.

Multiple MM moves are possible PT’s and the smaller ones are for locking in some profits as the move continues. Or for adding to a position on the PB’s where a little profit taking take place. I personally prefer to take profits on measured moves and enter again on the low of PB’s. Why? No one really knows when it will stop. Plus I get back in cheaper and by locking in and subsequently getting back in cheaper on PB’s thus in a way compounding locked in profits made previousley.

So...at this point in time in the range I see a bullish resolution of the present sideways range.

Padu is probably correct. But you always have to be ready for the unexpected event to occur and when it does it that unexpected even is usually a good move in the unexpected direction. Now we will see how it plays out....
 
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Bugsy said:
89oh.jpg


(Excuse the mobile image shot)

Its currently triple topping on the monthly chart which coincides with a bearish divergence on the RSI. We're coming into the last week of the current monthly candle displayed and I think it will continue to finish out this candle strongly, but the signs point to a coming drop imo. Thoughts?
More...

If the market is going to reverse into a legit sustained Bear trend (versus “momentary”) we’ll need to see a string of subpar earnings reports. (In addition to the price action).

Most big money managers are still overweight stocks - they’ve averaged in since 2009 and it will take more than a few percentage points in correction to get them to lighten up substantially. One of the most respected Managers on the street came out Monday and said he was still allocated at 75% equities and was looking for 6 percent more.
 
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