We repeat here two of our past comments.
April 4, 2008 Never be in a hurry to do something stupid. Lee Richartz
The geese are flying back north, the chickens are coming home to roost and the traders are feeling their oats and the pundits are saying buy buy buy and the chart is saying, what me worry? –or actually that was Alfred E. Bush. The chart is saying this is all a bunch of sideways stuff. To belabor the obvious all points after 4 (.1,.2 etc) are between 3 (low) and 4. By definition a trading range with a bearish bent. Any more questions? Good.
March 28, 2008 Dow 16000? Flying-Vampire Pigs, Levitating pundits…. Random egg attacks.
Note “A low” and “B low”. If this yearlong formation is a massive top (perhaps a double headed head and shoulders) and A low is its lower boundary then a low of 9680 is predicted. If B low is the defining point the predicted low is 10836. Remember Nils Bohr and the difficulty of forecasting. Again, it is not necessary to believe this scenario to know how to bet. The Dow is in a six month downtrend, the last 2 1/2 months of which are sideways, with lower highs in the sidetrend.