To measure or not to measure, that is the question as Shakespeare said in Measure for Measure. Everyone knows how much we hate to measure formations. Few know the reason. Nonetheless it is worth discussing likely implications of the little head and shoulders formation here. It is 664 points deep with a neckline of 8214 making a likely minimum target for prices of 7549.
Whether this is the definitive break of the neckline remains to be seen. The lambs may rush in tomorrow to join this rally they missed out on. The guys down at Morrie’s are probably warming up their voices right now. And whether this is another phase in the monster Kilroy (H&S) bottom we have been speculating about for months remains to be seen also.
The selling mood seems to be dragging down commodities also. DAG is probably worth selling, if only for precautionary reasons until the mood changes.
Wonder what kind of mood Bob Prechter (good friend of ours) is in. Wonder how many readers will appreciate the meta message of this cryptic letter.
Above the big picture in the first chart, and the little picture in the lower.