The Dow is attempting to breakout from this megaphone pattern as momentum is creating lower highs at (1), is attempting to break resistance dating all the way back to 1987 at (2), with valuations a little bit above their 114-year averages at (3), just 66% above (Source Doug Short)

Even though no long lasting bull market in 200 years has started from these current valuations…should we just set back and enjoy a breakout to higher prices? The Power of the Pattern would suggest risk management is very important at this price point!

How The Recent Decline In Stocks Looks "Eerily" Like Major Bear Markets Of The Past