On January 2, 2024 the Dow Jones Industrial Average (DJI) made a new post 10/27/23 rally high unconfirmed by the S&P 500 (SPX) and the Nasdaq Composite (IXIC). This bearish non confirmation is additional evidence that U.S. stocks may have begun at least an intermediate decline.
When one of the three main U.S. stock indices; SPX, DJI, and IXIC fails to make a new high/low unconfirmed by the other two main stock indices it’s a “Rule of the Majority” signal.
These signals can occur on the minor, intermediate and major scale.
On 12/13/23 the DJI made a new all-time high that has yet to be confirmed by the SPX and IXIC. This could mean a major top for U.S. stocks. The 01/02/24 signal is a non-conformation of the post 10/27/23 rally and bolsters the theory that at least an intermediate decline could be underway.
The daily DJI, SPX, AND IXIC chart courtesy of Trading View illustrates the action.
The next daily chart shows the SPX with two momentum oscillators.
The MACD has bearish lines cross. Both Stochastics lines are in the neutral zone. Daily momentum implies the SPX could continue to decline for at least one more week.
Traders are short 100% SPX non-leveraged funds from the SPX session open on 01/02/23.
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