DJIA hits top of expanding triangle.

Lots of chartists have been watching the decades long expanding triangle finish up its E (and thus final) wave.  If you look to the right hand 480 minute chart, the final wave of the E wave is itself hitting the E wave and has now touched the top resistance line of the DJIA.  Now, it's very possible if not probably that this wave formation could break out past the resistance in a big throw over just as the 480 minute chart is now in a throw over condition.  Regardless of possible rapid short term moves up from here, we are likely within several hundred points of the very top of the DJIA that most people of baby boomer age will ever see again. 

Why boomers?  Because they were all herded like cattle into the stock market with their retirement savings back in 1980.  The government was giving away free money, you see, in the form of tax deferment.  As long as you agreed that they got to hold your money in a government controlled 401k program, they would give you until your retirement until you had to pay taxes.  But this will turn out just like all the city police and fire departments who got told to work for partial wages while they accrued a fat pension.  They were really going to stick it to the people.  But then a funny thing happened on the way to retirement: cities all over the USA began to go bankrupt.  Cops, beginning to figure out that they were in fact the patsies in this crime, became ever more nervous about the situation and ever angrier at the people for "screwing them out of their retirements".  If you wonder why US cops shoot first (47 times) and then ask questions never, now you know.  They are just feeling the social pressure that everyone else is, but they have guns and a license to kill.


Hey don't shoot the messenger!

Back to the EW evaluation: check out the alternation between the C and the E waves (as circled in blue).  This is right out of the Elliott Wave playbook as is the very shape of the expanding triangle itself.  Because of the preponderance of them that I have seen of late, it would not surprise me to see this 5th of C of E finish up as an ending diagonal and in fact the 480 minute chart formation to the right does have many elements of an ending diagonal.

Now that the E wave is in throw over, the next thing to look for is confirmation of the chart pattern.  As always, first confirmation will come when the chart breaks back down into the channel. It will probably happen with gusto.  After bouncing up off the bottom support rail the next likely move would be to crash down through the bottom support line (the B-D line in the right hand picture below) as shown by the red line.  This should happen with a big gap down as its purpose is to turn the herd, to instill fear into it.

Today the VXX (the fear gauge) closed at 47.03 today.  Just check out the parallelism and alternation that has occurred at all levels of these waves.  While this model certainly looks correct, these final 5th of 5th of 5th waves become ever more chaotic to predict.  Still, this VXX chart screams of extreme complacency at a time when the fundamentals, namely confidence in the con men running this con game, is waning rapidly.  Some day people will figure out that the only fundamental in a confidence game is confidence.  When that is gone, the whole thing hits the dumper.  This comes in days, not weeks IMO.  Anything could trigger it. For example, if Yellen didn't get confirmed as the next fed chief then I think that could easily be the catalyst. 

And make no mistake, confidence in Obama is falling faster than a hooker on payday.  The things that are now surfacing about his past are nearly beyond belief and in fact I probably would not believe them if I hadn't already learned to suspend disbelief and just listen to the data while it is being given, saving judgement for a time where I can think about it.  If you don't know what I'm talking about just Google for the buzz on Obama and be sure to check Youtube as well.