Below we see a P&F chart of the Dow, obviously we are on a sell signal and more recently and hopefully the Dow has advanced by 10 boxes (each box equals 50 points). What is needed to turn the chart bullish is a decline of at least three boxes and then a column of rising X’s, which will take the new column above the high of the previous row of X’s. In other words, an upwards zigzag. Another way would be if the current column of X's simply rises to the 17,100 box.
Note that the recent plunge has taken the Dow below the three blue rising trendlines. Thus, the chart shows us that there is a huge amount of overhead supply pressing down on the Dow.
The chart below of the Transports tells a different story. Note that the Transports are trading above their long rising trendline. On top of that, the Transports have ... Log in or subscribe to continue reading.