Channeling More Bearish Evidence ~ The Risk Averse Alert

Thursday, September 03, 2009

Channeling More Bearish Evidence

Another top sighting...


Per the Elliott Wave Principle's channeling guideline, the analyst is advised to plot prospective 5-wave channels using both logarithmically- and arithmetically-scaled charts. I typically present logarithmically-scaled daily bar charts here. The above $NYA chart contrarily is arithmetically-scaled. And five waves up from March '09 bottom (wave C) channel like a champion.

There's another bit of evidence supporting a "top is in" thesis.

Price-, RSI- and MACD-wise, appearances still bear considerable resemblance to mid-June. However, volume presents a notably different picture. Tuesday's sell-off on chunky volume really stands out. That this has been followed by flat trading on diminishing volume likely indicates more selling yet to come.

NYSE 5-min

And today's final hour launch taking RSI to a buy-side extreme concurs.

Fast Money
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