On 16 November I noted that the DJIA was flattening out and possibly rolling over. Today it looks like the roll over might just be starting. I don't have a crystal ball so I can't predict with any certainty that the market will rise or fall by any amount, but looking at the chart below it really looks like it's extended and it wants to pull back and consolidate. I'm still expecting a Santa Claus Rally this year but it looks like there may be a pullback before that rally starts.
Notice on the chart that the RSI is in overbought territory and beginning to fall, and the MACD and MACD Histogram are falling below their signal line. I'm becoming very cautious and looking for a pullback in the DJIA to its nearest support level near 17,300 again. Failing to hold support at that level, the next support levels are at 16,950 and 16,300.
A look at the chart of the S&P500 shows similar results.
Notice on the chart that the RSI is in overbought territory and beginning to fall, and the MACD and MACD Histogram are falling below their signal line. I'm becoming very cautious and looking for a pullback in the DJIA to its nearest support level near 17,300 again. Failing to hold support at that level, the next support levels are at 16,950 and 16,300.
A look at the chart of the S&P500 shows similar results.
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