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Monday, December 21, 2009

Global Dow....Topped?


The Global Dow makes fine Elliott Waves.  It is the one major index that had lower lows recently and today's bounce looked weak and has a "three" abc look about it.   The 60 Minute charts sports 5 wave structures down from its recent peak. There is a 50/200 cross going on and that is bearish.

The weekly has a double negative divergence and hit the 50% fib retrace from the 2007 high. One thing that is rally scary is how high the GDOW is when you look at the 2002-2003 low area.  We have a long way to go! Its a lot of leveraging that needs de-leveraging. Also the MACD has crossed. Bearish.

The next moves would be a very bearish wave iii or a "third of a third".   Perhaps that coincides with the DJIA breaking the rising trendline from the March low.

http://4.bp.blogspot.com/_TwUS3GyHKsQ/Sy_q16xPHvI/AAAAAAAADF0/PA8ZwRXEiFc/s1600-h/djia.png

I'd say there is an excellent chance that the GDOW has topped.  But we need more waves down to form an overall 5 wave structure to confirm.  But there is a possibility that a very bearish down move is right around the corner.

Now that I said that, I'm sure it'll have a record day up tomorrow LOL!

If the GDOW has topped, the rest of the indexes are not too far behind.
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