A bullish channel is called a continuation trend pattern. The bullish channel is assembled by two parallel lines that frame the upward price trend. A line is validated when there has been at least two points of contact with the price. The more contact points it has, the stronger the trend line is and the more their breakout will give a strong sell signal.

The bullish channel is one of the most used chart patterns. You can find it on every time frame. There is no theoretical target in this pattern. The movement can continue as far as the lower band is supported.

Here is a graphical representation of a bullish channel:

It is not recommended to take a short position at the contact with the upper band. Actually the trend may continue along the upper band. Besides, the movement towards the lower band are correction movements into an upward trend and are therefore less powerful.

Try to avoid false breakouts by drawing your trend lines based on high and low points of candlesticks and not their body.

The breakout often occurs at the 4th point of contact.

The more the lower band acts as support, the more the breakout will be violent.

A bearish channel is a continuation trend pattern. The bearish channel is arranged by two parallel lines that frame the downward price trend. To certify a line, there has to be at least two points of contact with the price. The more contact points it has, the more the trend line is stronger and their breakout will give a stronger buy signal.

The bearish channel one of the most used chart patterns. You can find it on every time frame. There is no theoretical target in this pattern. The movement can continue as far as the upper band is resistance.

Here is a graphical representation of a bearish channel:

It isn’t a good idea to take a long position at the contact with the lower band. Actually the trend might continue along the lower band. Also the movements towards the upper band are correction movements into a downward trend and as a result are less powerful.

To avoid false breakouts, draw your trend lines based on high and low points of candlesticks and not their body. The breakout will often occur at the 4th point of contact.

The more the upper band acted as resistance, the more the breakout will be violent.

The triple top is a bearish pattern with an MN shape. Three bottoms will come in succession, reflecting an important resistance. This marks a reversal will.

Below the triple top shows the area of resistance that will lead to a correction of the price three times. The neckline pattern will be formed by the lowest of these two bearish peaks. An initial correction will then occur and, then the price will go back on resistance. The magnitude of these three tops are normally the identical (as in the case below), but it may happen that the first top may be lower than the next two tops. This composition strengthens the validity of the pattern since it reflects a breathlessness of buyers.  If the second top is higher than the two others, it could be a head and shoulders pattern.

Another correction will take place, theoretically on the same level as the first correction. Provided that the neckline is broken at this point, then it can be a double top. In many instances we know afterward what type of pattern we will face. A return on the resistance must be done. If the third top were higher than the first two, then that would reinforce the chances of reversals (breathlessness of buyers). The third correction that will lead to the breakout of the neckline and will validate the bearish reversal.

Once this neckline is broken, it could happen that the price will take resistance on it (that line becomes a resistance, called a pullback), then the price will take up its bearish movement. A target price will be determined by the gap between the resistance and the neckline.

Another example of a triple top with a breathlessness of buyers (top are less and less high) is provided.

Following are are several statistics about the triple top:

– In 85% of cases, there is a downward exit.
– In 50% of cases, the target of the pattern is reached once the neckline is broken.
– In 84% of cases, a pullback will occur.
– In 85% of cases, there is a pursuit of the movement once the neckline is broken.

In case of pullback, the downward movement may not be as important once the target of the pattern is reached.

If the resistance is overly tested prior to a correction (flat top), then the decrease following the breaking of the neckline will be more important.

The more the three tops are close, the more of the percentage of success of the pattern is high.

The more the movements between the neckline and resistance are straight, the more the pattern is efficient.

The more the bullish movement proceeds the formation of the triple top is big, the more the downward movement at the breakout of the neckline will be strong.

The pattern is more efficient if the third top is not as high as the other two.

Triple bottom is a bullish pattern with a WV shape. Three bottoms will succeed, reflecting an important support. This will mark a reversal. See the triple bottom shown below, the area of support allows the prices to bounce back three times. The neckline of this pattern is formed by the highest peak of the two bullish peaks. An initial bounce will then occur and the price will go back on the support. The bulk of the three bottoms is usually the same (as indicated below), however it can happen that the first bottom may be lower than the next two. This configuration strengthens the validity of this pattern since it reflects a tension of sellers.

If the second dip is lower than the other two, it can be a reverse head and shoulders pattern. A second rebound will take place, probably on the same level as the initial bounce. However, if the neckline is broken at this point, it can be a double bottom. In some cases, afterward we know what type of pattern we were facing. A return on the support must be accomplished. The third bottom may be lower than the first two thus reinforcing the chances of reversals (tension of sellers). This will be the third rebound which leads to the break out of the neckline and reinforce the bullish reversal.

When the neckline becomes broken, it might appear that the price takes support on it (the line will become a support, called a pullback); then the price will take up its bullish movement. The target price is decided by the gap between the support and the neckline.

Another example of a triple bottom with a tension of sellers (bottoms are less and less low) is indicated here.

Here are some statistics about the triple bottom:

– In 66% of cases, there is an upward exit.
– In 73% of cases, the target of the pattern will be reached once the neckline is broken.
– In 70% of cases, a pullback will occur.
– In 96% of cases, there is a pursuit of the movement once the neckline is broken.

In case of pullback, the upward movement is not as important once the target of the pattern is reached.

If the support is endlessly tested prior to a rebound (flat bottom), then the increase following the breaking of the neckline will be more important.

The more the three bottoms are close, more of the percentage of success of the pattern will be high.

The more movements between the neckline and support are straight, the more the pattern is efficient.

The more the bearish movement that precedes the formation of the triple bottom is  big, the more the upward movement at the breakout of the neckline will be strong.

The pattern will be more efficient if the third bottom is not deeper than the two others.

Reverse head and shoulders is a trend reversal pattern. It will mark a desire to make a bullish reversal. The theory is the same as a triple bottom other than the second bottom will be lower than the others, which are technically at the same height. The reverse head and shoulders pattern will be formed by three bottoms that will succeed.

The first and third bottoms are around the same height. It’s said that they formed the shoulders. The second top is lower than the other thus representing the lowest point. This is the head. There are few rules for many investors say that the height of the head should be 1.5 or 2 times lower than the shoulders. Investors also agreed that spacing between each bottom has to be the same. This is a major point to identifying patterns.

The highest attained between the shoulders and the head shape the neckline (in red below) that acts as a resistance. The neckline can be ascending (38% of cases), descending (40% of cases) or horizontal (22% of cases). This is the breakout of the resistance that validates the reversal patterns. The target price is equal in distance between the neckline and the bottom of the head that we symmetrically carry over to the neckline. This pattern is well known to investors and that is what makes it successful.

The reverse head and shoulders pattern offers a good performance on a bearish trend.

Some statistics about the reverse head and shoulders follows:

– In 98% of cases, there is an upward exit.
– In 97% of cases, there is a pursuit of the bearish movement at the breakout of the neckline.
– In 74% of cases, the target of the pattern is reached once the neckline is broken.
– In 52% of cases, a pullback occurs on the neckline.

The trend before the formation of the reverse head and shoulders is long, then the upward movement at the breakout of the neckline shall be strong.

The movement prior to the formation of the reverse head and shoulders is brutal, the upward movement at the breakout of the neckline will be very important.

Patterns with an descending neckline will give a better performance.

If the left shoulder is over the right shoulder, the pattern gives better performance.

Pullbacks on the neckline may be harmful to the performance of the pattern.

The symmetrical broadening bottom is called a bullish (if reversed, then bearish) reversal pattern. This pattern is formulated by two symmetrical horizontal lines that are divergent. It is an inverted symmetrical triangle or looks like an open triangle. The oscillations between the two bands of the triangle are consequently becoming more sizable. Each line has to be touched at least twice for a validation.

The symmetrical broadening bottom indicates the increased nervousness of investors but also with their indecisiveness. If this pattern is not identified immediately, this movement might seem quite random and hence trapping investors.

This formation of the pattern must be indicated by an upward movement. The pattern is frequently attributed to cheap purchases that will form new highs. However, pressure to sell remains strong and the indecisiveness is dominate.

A target price will be given by plotting the height of the triangle from its beginning on the break point. A similar technique is to extend the maximum height of the triangle on the break point.

A graphical representation of a symmetrical broadening bottom follows:

Statistics about the symmetrical broadening bottom are as follows:

– In 58% of cases, there will be an upward exit.
– In 60% of cases, the target of the pattern will be reached by taking the maximum height of the triangle. Then with a downward exit, the percentage will go up to 70%.
– More than 78% of cases, downward breakout occurs when the price is into the lowest third of its annual range.

Pay attention to the indecisiveness patterns.

Bearish potential will be greater than the bullish potential in case of breakout, which is rare in technical analysis.

Notice that from the fifth rotation (i.e., the fifth points of contact on either resistance or support), there will be 80% chance that the exit will occur at the next contact point and the support or resistance of the symmetrical triangle. Then from the sixth rotation, this percentage will rise to 90%.

The double top is a bearish pattern shaped like an M. Two tops must succeed, imaging an important resistance. This marks a reversal. The pattern may also be in WV shape. We can consider a triple top as well.

The initial correction will decide how the neckline is evidenced by the lowest between the two tops. Consequently, the price will return to the resistance. The degree of the two or three tops will normally be the same (as our example below shows), however it may happen that the first top will be higher than the first one. This configuration will reinforce the validity of the figure since it will reflect a breathlessness of the buying movement. A third rebound could happen, but in all cases, it is the breaking of the neckline that should validate the bearish reversal.

Once the neckline is broken, it could happen that the price will get back to it (this line becomes the resistance), then will decrease again. The potential of this decrease is determined by the difference among the beginning resistance and of the neckline.

Following are several statistics about the double top:

– In 75% of cases, there will be a bearish reversal.
– In 71% of cases, the target of the pattern is reached once the neckline is broken.
– In 61% of cases, a pullback will occur.
– In 83% of cases, there is a pursuit of that movement once the neckline is broken.

In case of pullback, the upward movement will be less important once the target of the pattern is reached.

When more the two bottoms are closed, the more the percentage of success of the pattern is important.

The more the bullish movement that precedes the formation of the double top is important, the more the downward movement at the breakout of the neckline will be powerful.

The double bottom is a bullish pattern indicated by a W shape. The two bottoms will succeed, mirroring an important support (in green). This will mark a reversal will. The pattern may also be in a WV shape. We’ll discuss a triple bottom.

Showing the double bottom below, the area of support will let the price rebound twice. The first will determine the neck line (in red), illustrated by the highest between the two bottoms. Furthermore, the price should get back to the support. The magnitude of the two bottoms is often the same (as indicated below), however it could happen that the first bottom is lower than the first. This configuration strengthens the validity of the figure since it reflects a breathlessness of the selling movement. Another rebound will then occur, but the breaking of the neck line that will validate this bullish reversal.

Once the neck line breaks, it might happen that the price will get back to it (this line then becomes support), then increases once again. The possibility of increase is decided upon by the difference between the beginning support and the neck line (noted by the black arrows).

Here are some statistical facts about the double bottom:

– In 70% of cases, there is a bullish reversal.
– In 67% of cases, the target of the pattern is reached once the neckline is broken.
– In 59% of cases, a pull back occurs.
– In 97% of cases, there is a pursuit of the movement once the neckline is broken.

They are several types of double bottom that are differentiated according two criteria.

The shape of the bottom can be a V-shape (known as Adam bottom) or a U-shape (called an Eve Bottom).

The second bottom might be higher, at maybe the same or lower than the first bottom.

In case of pull back, the upward movement will not be as important once the target of the pattern reached.

More the two bottoms are close, more the percentage of success of the pattern is vital.

The bearish movement that precedes the formation of the double bottom is important, more the upward movement at the breakout of the neckline will be powerful.

Diamond tops are a reversal pattern. This pattern is formed by two juxtaposed symmetrical triangles. It’s shape is like a diamond.

Diamond tops have to be preceded by an upward trend. This pattern shows the shortness of buyers and as a result investor’s indecisiveness. However, this pattern will reflect a growing volatility which will eventually be reduced towards the end of the diamond.

Oscillations are of multiplied amplitude and then decreasing which suggests a trend reversal. Actually buyers will gradually abdicate.

The target of the pattern is calculated by plotting the maximum height of the diamond at the exit point. The downward movement is normally as fast as the upward trend that preceded it.

A graphic representation of a diamond tops is as follows:

Following are some statistics about diamond tops:

– In 80% of cases, there is a downward exit.
– In 95% of cases, the target of the pattern is reached.
– In 59% of cases, a pull back will occur.

There are three times more diamonds tops than diamonds bottoms.

It is occasionally possible to see an inverted head and shoulders within the diamond bottoms.

This pattern is quite hard to see. At the beginning of the formation of a diamond, the pattern appears to be like a widening of a symmetrical triangle. But, the symmetrical triangle is a continuation pattern and the diamond is a reversal pattern.

A reversal pattern is called a diamond bottoms. This pattern is formulated by two juxtaposed symmetrical triangles. It is shaped like a diamond.

Diamond bottoms must be preceded by a downward trend. This pattern targets the shortness of sellers and consequently investor’s indecisiveness. Similarly, this pattern shows a growing volatility which is gradually reduced towards the end of the diamond.

Oscillations are increasing amplitude and then decreasing thus suggesting a trend reversal. Actually sellers gradually abdicate.

The target of the pattern is figured by plotting the maximum height of the diamond at the exit point. The upward movement is normally faster as the downward trend that precedes it.

Here is a graphic representation of a diamond bottoms:

Statistics about the diamond bottoms are as follows:

– In 82% of cases, there is an upward exit.
– In 60% of cases, the target of the pattern is reached.
– In 43% of cases, a pull back occurs.

There are three times more diamonds tops than diamonds bottoms.

It occasionally is possible to see an inverted head and shoulders within the diamond bottoms.

This pattern is difficult to see. At the beginning of the diamond formation, the pattern appears like a widening of a symmetrical triangle. But, the symmetrical triangle is a continuation pattern and the diamond is a reversal pattern.

A falling wedge is a bullish reversal pattern made by two converging downward slants. To prove a falling wedge, there has to be oscillation between the two lines. Each of the lines must be touched at least twice for validation.

The pattern labels the shortness of sellers. A characteristic is by a progressive reduction of the amplitude of the waves. The highest will reach during the first correction on the support of the wedge and will form the resistance. Another wave of decrease will then happen, but with lower amplitude, thus displaying the weakness of sellers. A second wave is formulated thereafter but prices will decrease lower and lower at the contact with the resistance. Volumes will then be at their lowest and eventually decrease as the waves. The movement will have almost no selling power which displays the willingness of a bullish reversal.

The target price is presented by the highest point that results in the formation of the wedge.

Here is a graphical representation of a falling wedge:

Check out some statistics about the falling wedge:

– In 92% of cases, there will be a downward exit.
– In 63% of cases, the target of the pattern will be reached once the resistance is broken.
– In 47% of cases, a pullback will occur on the resistance.
– In 27% of cases, false breakout occurs.

The spacing between each contact point on lines is necessary, it is important otherwise it could be a pennant.

More of the trend lines are sloped, the more the upward movement will be violent.

The downward retracement is normally two times faster than the formation of the wedge.

Pullbacks are detrimental to the performance of the pattern.

The breakpoint is normally located around 65% of the length of the falling wedge.

Falling wedges which are bigger give better performance than narrow wedges.

A bearish reversal pattern formed by two assembled upward slants is called a rising wedge. To validate rising wedge there must be oscillation between the two lines. These lines must be touched at least twice for validation.

The pattern indicates the shortness of buyers. This one is identified by a continuous reduction of the amplitude of the waves. The lowest will be reached during the first correction on the resistance of the wedge and will form the support. The second wave of increase will then occur, however with lower amplitude, which may appear the weakness of buyers. Another wave will be formed thereafter but prices will increase less and less at the contact with the support. Volumes will then be at their lowest and constantly decrease as the waves. This movement then has almost no buying power which will indicate the willingness of a bearish reversal.

The target price is given by the lowest point that resulted in the formation of the wedge.

Below is a graph representing a rising wedge:

Take a look at some statistics about the rising wedge:

– In 82% of cases, there will be a downward exit.
– In 55% of cases, the rising wedge shows a reversal pattern
– In 63% of cases, the goal of the pattern is reached once the support is broken
– In 53% of cases, a pullback arises on the resistance
– In 27% of cases, false breakouts occur

Note the spacing between each contact point the lines must be important otherwise it could be a pennant.

The more that the trend lines are sloped, the more the downward movement will be violent.

False bearish breakouts provide an indication on the side of the exit because in only 3% of cases, when a bearish breakout occurs, the price will go out of the wedge by the top. The risk of running a false bearish break out is quite low.

An upward retracement is normally two times faster than the formation of the wedge.

Pullbacks will be harmful to the performance of the pattern.

A break point is normally located around 60% of the length of the rising wedge.

Rising Wedges that are large will give better performance than narrow wedges.

Stock charts print different topping formations. Some are classics, like the Descending Triangle, which can be understood and traded with little effort. However the emotional crowd additionally generates many undependable patterns while greed slowly evolves into mindless fear. Complex Rising Wedges will challenge a technician’s best effort at prediction while the unusual Diamond pattern burns trading capital swinging randomly back and forth.

Skilled traders refrain from these fruitless positions and will only look for profits where the odds strongly favor their play. First they’ll locate a common feature discovered in most topping reversals. Price draws at least one lower high within the broad congestion prior to violating a major uptrend. This common double top mechanism will become the focus for their trade entry. From this precise signpost it will follow the price to a natural breaking point and enter when violated.

Remember the Adam & Eve Bottom discussed earlier. This unique formation consists of a spiking first bottom, followed by a rounded second one. Flip the pattern around and you will see a highly predictive structure for trading these topping reversals.

This easy Adam & Eve Top gives traders frequent high profit short sales opportunities. Take note of this classic pattern in Quantum’s chart. The price never drew a third high prior to entering a significant bear market.

Successful Adam & Eve short sales may be entered on the first violation of the reaction low, regardless of an underlying trend. Use tight stops to prevent “turtle reversals.” They happen when sharp shorts covering rallies unexpectedly erupt right after the gunning of stops below a violation point.

Every uptrend produces positive sentiment that has to overcome the topping structure. Adam & Eve tops represents an efficient bar structure to succeed in this task. The violent reversal of Adam first awakens fear. Then the slow dome of Eve devours the remaining bull impulse while dissipating volatility needed to resume a rally. As the dome finishes, price moves swiftly to lower levels without substantial resistance.

Observant technicians recognize the mechanics of Descending Triangles and Adam & Eve formations in a lot of complex reversals. The vast majority of tops contain some characteristics of these similar patterns. Crowd enthusiasm will be eliminated for a decline to proceed. Through the repetitive failure of price to achieve new highs, buying interest eventually recedes. Then the market can eventually drop from its own weight.

Double Top Breakdown

Quantum’s 1997 multi-year high breaks down in a dramatic Adam and Eve Top. Pay attention to both volume and volatility readings to decline gradually through the formation of the second rounded high. Often, this “Eve” consumes more price bars than the “Adam” that precedes it.

A bullish reversal pattern formed by two diverging downward slants is a descending broadening wedge. To validate an descending broadening wedge, there has to be an oscillation between the two lines. Each line has to touch at least twice for this validation.

The pattern will mark the shortness of sellers. It is characterized by a progressive reduction of the amplitude of the waves. Actually the pattern appears like a bearish channel on which the slope of the resistance is becoming straight as far as the movement moves forward. In this pattern, the trend is bearish but sellers are attempting to retain control.

The target price is given by the lowest point that results in the formation of the wedge.

Look at the graphical representation of a descending broadening wedge:

The formation, ascending broadening wedge is called this because of its similarity to a rising wedge formation and then has a broadening price pattern.

While symmetrical broadening formations have a price pattern that revolves about a horizontal price axis, the ascending broadening wedge differs from a rising wedge as the axis rises.

The upper trend line of an ascending broadening wedge goes upward at a higher rate than the lower one, thus creating an apparent broadening appearance. The ascending broadening wedge formations volume is likely to increase ever so slightly as the breakout advances.

The patterns are very trustworthy once a downside break happens, however they are less reliable prior to the break of the lower trend-line. Thomas Bulkowski’s Encyclopedia Of Chart Patterns notes the failure rate for this pattern formation is 24%, however only 6% where a downside break occurs, suggests that once the downside break happens there is a possibility that a price recovery and a continued decline should be expected.

Once the decline begins prices will most often decline to, or below, the start of the formation.

The two sloping trend lines are the most obvious thing you will notice; the upper one will have a slightly steeper slope than the lower one and the trend lines will then spread out over time while both slope upward. When prices break through the lower trend-line they will tend to drop quickly.

Price movement is contained and alternates between the two non-parallel trend-lines. This is indicated in the below chart.

On many occasions, these formations will appear towards the end of a rising price trend and signal a reversal. A partial rise does not predict a change in trend.

There are quite a number of characteristics that will be unique to ascending broadening wedge formations;

• The upwardly tilted megaphone shape.
• Both upper and lower trend-lines will slope higher.
• The upper trend-line will have a higher slope than the lower one, giving the appearance of a broadening formation.
• Each trend-line should have a minimum of three touches, or close to that.
• Volume normally rises as prices move up and declines as prices move down.
• Volume tends to rise over time in most cases.

If prices do break the lower trend line, the price action may be chaotic and occasionally runs straight through the lower trend-line without even pausing on the way through. The average decline of a confirmed pattern is about 20%

In the case of a partial rise going towards the end of the pattern, prices start moving upward, after having found support at the lower trend-line, then stop prior to touching the upper one. Prices will immediately return to the lower trend-line and normally head lower, breaking towards the downside.

In Thomas Bulkowski’s Encyclopedia Of Chart Patterns, only 6% of the formations breaking out downward will fail to continue moving down by more than 5%. This is an exceedingly low figure. Also there is a 76% chance that the formation will break out downward. It therefore pays to wait for a confirmed breakout.

The measure rule for this type of formation will differ from most other formations in that it will be based on the lowest daily low, not on the height of the formation. The low serves as the expected minimum price move.

Again this formation is a good account for downside breakouts. About 1 in 5 will see prices movement horizontally or even break out upward. Holding out for the downside break is the favorite  approach and considerably increases the possibility of a profitable trade.

When prices begin to decline below the lower trend-line, think about a short position and then be prepared to cover when prices approach the target or at the next closest level of price support.

Provided that you identify a partial rise, consider taking a short position since around 8 of 10 cases show a downside breakout following a partial rise, because you will have a ‘heads up’ profits should be larger. If this approach is taken, as the trade advances the lower trend-line, consider tightening your stop-loss in case price reverses, thereby protecting your position.

The Dow Jones Industrial Average’s bearish Rising Wedge stayed consistent since the previous time it was shown in April 16’s Dow: Bullish or Bearish?

This is the Dow’s updated bearish Rising Wedge in the framework of the 2-year chart that gives us strong reason to trust that the long-term answer to the question will be quite different from the recent bullish reversal of what had been a near-term downtrend.

Take a look at what the bearish Broadening Top can do in the weekly chart on the following page that does not show the week’s rise.

Perhaps the recent Broadening Top and just a fractal footprint of the larger Rising Wedges that top into Broadening Tops, will somehow avoid both the Broadening Top and the far more bearish Rising Wedge, however there are several good and relatively current chart history suggesting this is not likely.

This is especially valid when the Dow’s recent Broadening Top is pulled apart just around today’s outside candle since it is not known whether it will turn into an outside reversal even though this seems likely.

Particularly if the Dow’s big Broadening Top consists of bearish Rising Wedges that achieve in bullish Falling Wedges and vice versa but with the bearish nature of the pattern indicating that the Rising Wedges will win ultimately as does the small Broadening Top created today on the outside candle with a pattern that confirms at 13175 for a target of 13011.

The pattern is a helper to the current Rising Wedge inside the larger Broadening Top. It confirms the same level but for a current target of 12083 and not quite sub-12000; that had been guessed at earlier.

A reason to assume it will not go sub-12000 as a formal target, even though the Dow may have a Rising Wedge shown on the first page, is the smaller Broadening Top appears to be the apex of the smaller Broadening Top in trading that seems uncannily like last July into August.

The first small Broadening Top resembles the current one in relation to its Rising Wedge at that time and suggests there may be some other sideways trades ahead prior to the resolution. If the comparison carries on into resolution, it is apparent that it will be a bearish and not a bullish resolution.

Consider the current Broadening Top is more compact than the prior one, the reason for drawing the intermediate-term trend-lines differs in the second chart. There is a valid reason to know that such a resolution will not require much more sideways trading before it displays what could be a 10% drop in the big Broadening Top alone. Not to say the multi month Rising Wedge that delivers a 10405 target for a potential decline of 22% and another correction in the many corrections and rallies of the longer 2-year sideways trend.

One should not assume that the Dow’s Broadening Top will do as it expected or as its prior Broadening Tops has done with the potential for the promise of some liquidity.  Liquidity slosh is always possible to cause this pattern to do something unique than what it normally does and that means treating both sides even though this pattern breaks to the downside nine times out of ten.

It’s an unlikely upside scenario, but confirms at a seemingly ridiculous 13692 for an even more outlandish target of 14673 and that would be an all-time high with its downside scenario confirming 12711 for the aforementioned target of 12083.

After the dissection of the Dow’s bearish Broadening Top, it appears more likely that it too will do as its bearish brethren have done before it which equates to a 200-DMA-crossing drop.