The closing for April in the Dow Jones Industrial Index was very interesting to say the least. The closing at 20940.51 was just under our numbers defining bullish indicators – 20770-20975. This tends to suggest we are not breaking-out just yet and the turning point to watch has been the week of May 8th. If we look at the energy model above, we can see that energy is still positive. Typically, this indicator begins to decline showing little positive activity just before a crash when it goes negative. Here you can see our proprietary indicator back into 2007. The real crash was negative and pronounced. The other two times it went negative were marginal warning a brief correction and not a major change in trend.
We can see even technically it will now take a weekly closing below 2000 to spark a sustainable correction.
