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Over the past 14-years, the Dow looks to be creating a rather large mega-phone pattern. The rally over the past 18-months has brought the Dow to the top of the pattern in the left chart above.
Both charts reflect that the Dow is facing long-term resistance with monthly momentum reaching fairly lofty levels, where it has run out of steam in the past!
What the Dow does at the top of the mega-phone pattern should have much to do with where the Dow is at the end of this year. Should the Dow muster up enough buyers to push it past resistance, it would be considered a positive breakout for this index.
Is this pattern why the Dow is moving up slowly this year? Would a breakout bring in more buyers and push it up rapidly? Stay tuned to see how the Dow deals with this key long-term pattern that could have much to do with its long-term trend.