vlad.adrian
Short

Dow - bearish divergences finnaly confirmed

AMEX:DIA   SPDR DOW JONES INDUSTRIAL AVG ETF T
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I have been posting charts with bearish divergences for the past months, waiting for a correction. If I would go with the flow, I would have made a nice profit, but lack of experience plays its hand. Finnaly, the bearish divergence is confirmed by the downtick of the histogram. Both Force Indexes, which I use independently (each one giving a different perspective) are in a very ugly bearish divergence. The longer term FI , has a double class A bearish divergence, while the small term FI used for precision and small swings, is in a multi peak divergence. The MACD lines post a double class A bearish divergence, while the histogram clearly points out the lack of steam from the bulls. Volume is not working, no idea why, but looked at it last night and seemed very light, but I'll have to look again.

Target for the correction is the second strong support at 16000, which conincides with the value zone of the Dow, and further down the 15500 very strong support level . At 15000 - 15500, I would start getting really bullish . I'm not looking for the end of the bull market, but only for a correction. The only time when we'll know we are in a bear market, is when bears are going to be in full control. Until then, trend is still up, look for longs after a correction.

Daily doesn't give any signal yet, so I'm just waiting for now. If this divergence failes, then I think the market is in gear for at least another 1000 points over the last high.

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The highest price I have for today so far is 16699. Hope that helps.
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