Elliott Wave Analysis of the Dow Jones Industrial Average (DJIA) by Sid from ElliottWavePredictions.com

Elliott Wave Analysis of the Dow Jones Industrial Average (DJIA) by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.

The up-slanting chop since March 19 in the DJIA meets all the rules of a completed ending expanding diagonal. Wave 3 (green) is longer than wave 1, wave 4 is longer than wave 2, and on the 28th, wave 5 achieved greater length than wave 3. Usually, wave 5 of an ending expanding diagonal will end just before reaching a trendline extending from the extremes of waves 1 and 3, although a throw-over of the line is also possible. The Dow Jones Industrial Average closed the week just beneath that trendline.

There are lots of other signs of a significant top in US equities like extreme bullish sentiment, rallies on low volume, a diverging advance/decline ratio, widening bond spreads, tops already showing in European equities and many commodities, and a strengthening US dollar. Something’s gotta give, and I think it will (finally) be US equities.

For a review of my intermediate and long-term DJIA count, see my February 21 post.

Sid’s products:
– Weekly “Counts” Webinar (includes access to a recording of it immediately afterwards)
– EWP ScreenShots (includes a weekend and mid-week update)
– Early Detection of Trend Changes (a movie explaining Sid’s method)
– On-Demand Analysis (one-time analysis of a single item)

Sid