A Possible Broadening Top

Noticing a few things here:

1) The 200 week MA is still within reach at 1195. Institutions have this on their radar at all times. You can bet the public would be right behind on a wave of optimism, as inflows to mutual funds are finally picking up.

2) We are at the top of the range of a possible broadening top on the 60 minute chart of the overnight session. This pattern, combined with back-to-back 90% up and 90% down days, implies a market that is slowly veering out of control. I have just shorted here at 1182 with a stop at 1185.25. I'm taking the shot here because the risk/reward should I be correct is worth it, as the pattern implies a test of the 1150 area. If I'm stopped, I'll likely change my view and prepare for 1195-1200, or re-short higher.

3) The dollar will likely hit new lows based on its failure to get above 79. But just as in July 2007, look for non-correlations to appear, i.e., the EUR to fail to reach new highs, possibly CAD, and most importantly gold and silver as well.

Trading is three-dimensional chess on an international scale. Always have a variety of scenarios at hand. Always know where you're wrong, and what you stand to lose.