The Dow - Crack allready!!!

Global markets are getting more annoying with every day that passes. The conflict in Ukraine is not helping because it brings volatility to the markets, especially the European markets. Correlation between major global markets is very strong, and who ignores it and analyzes markets indiviadualy loses the big picture. Weekly charts show ascending triangles, but all markets are losing momentum with each rally.

Yesterday's reaction after Yellen's speach was terrible, bringing confusion. Today, the exact opposite. Price rallied, and by the end of the day pros got prices lower. This happens all the time after big events, the first reaction is done by the amateurs, but after the pros come and close the day.

Another false breakout over 16500, another divergence, with the Dow in front of the other indexes. The Russell leads the fall, followed by the Nasdaq. I keep saying this in my posts, because it is a very important warning signal.

The rallies are getting weaker and weaker, shown on the chart using deviations from the moving averages. The MACD lines are still in a bearish divergence, with the histogram losing strength each time price rallies, and a bearish divergence on the Force Index.

I am short the Nasdaq, because I figuered a position there will be more profitable than on the Dow, because of the bubble stocks included in the calculation of the Nasdaq.