A continuing theme, the Dow continues to traverse the psychological important 12,000 round number. This has seemingly garnered a lot of excitement; there is no shortage in supply of wildly bullish guests on CNBC ready to proclaiming the market will continue to move strait up. Again proving the Milgram experiment valid, the masses seem to be nodding blindly to this community of "professionals" despite them missing every major turn in the last 10 years. Meanwhile, I've been noting the deteriorating internals, the extreme sentiment, the overbought momentum, and now the other indexes seemingly topping out, thus the Dow Theory Non-Confirmation continues...
Chart 1: DJI, Transports, Nasdaq, Russell 2000
The Nasdaq appears most willing to break to new highs, though with today late day reversals in Microsoft and Amazon, I'm not sure this will happen. Meanwhile the transportation index and Russell 2000 still appear to be correcting from their first thrust down, and are running into Fibonacci resistance.
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