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

DJIA 60m 3-29-13

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)