Dow 30 Jan 14 to Jan 18 Outlook

Recap
Sold off in the beginning of the week, yet the gap from last year acted as strong support. Sellers forced to give up. Rising wedge all week since. Closed the week near week high and above Y+1.

Outlook
2nd week in a row move in rising wedge formation. The 2 combined together is now a even bigger rising wedge formation in the making.

As posted here, we are seeing a repeat of the price action of 2012 1st 2 weeks.

Would Dow simply starts an all out rally again?

Price pattern is bearish, breadth is overbought by aprox. 400 pts. My take is that we will not get a repeat of last year.

The key event that will invalidate the bearish bias is for Dow to zoom above 2012 year high and stay above on weekly close basis for another leg pushing up.

Playing the bearish side from here means you need a huge stop against this potential FBO on yearly boundary. Not something suitable for everyone.