Dow Industrials (left) & Dow Transports: While the recent rally has been important and the channel top that limited last week’s gains on the Dow Industrials has now been breached, we continue to remain cautious. The momentum indicator shows weakness in this rally as it has been diverging away from the price. A fall over the coming days, will likely mean that triple momentum divergence will be completed on both markets which will strongly suggest weakness in the short term uptrend. Overall we remain cautious for stocks.
Dow Industrials & Dow Transports – Caution still necessary
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