The Dow - along with all other indexes, is continuing to climb on a general basis, but its certainly looking like a giant wedge, which by definition should break to the downside. There is reasonable confidence in this outlook, the big unknown though is how far down do we go in the next multi-week down cycle.
Dow, weekly, 2yr
Dow, monthly, 6yr
Summary
Clearly, dow 13k is a key level of support, and until that is taken out, the bears are arguably better to just sit and wait for the break lower first. After all, the current trend could just keep on going all the way into 2013.
What is interesting is if 12k fails - as near impossible as that might seem right now, it would probably lead to an eventual hit of the 11k support/channel. Right now, 11k sure is a very long way down, a 'distant hope' doesn't even begin to cover it.
Were I the Bernanke, I'd sure wait until dow'11k, and then spool up the digital printers to max. As it is, another FOMC decision is due this Thursday at 12.30pm. We'll just have to see what the Fed maniacs decide, I'm guessing nothing is done until the December FOMC.
As for the German court decision on the ECM this Wednesday (time unknown), that's probably even more an unknown variable than the Fed.
Goodnight from London