Friday’s decline broke the neckline of a small head-and-shoulders pattern seeming to leave behind the cupola Lindsay described as the top of his Domed House pattern: points 21 - 25.

If the market holds to the template, the Dow should fall to point 26 and rebound to point 27 within the same price range as the First Floor Roof (points 15-20).

That consolidation is followed by a return to the bottom of the Separating Decline at points 10 and 14 on the chart below.

Try a "sneak-peek " this month at Seattle Technical Advisors.com

Ed Carlson, author of George Lindsay and the Art of Technical Analysis, and his new book, George Lindsay's An Aid to Timing is an independent trader, consultant, and Chartered Market Technician (CMT) based in Seattle. Carlson manages the website Seattle Technical Advisors.com, where he publishes daily and weekly commentary. He spent twenty years as a stockbroker and holds an M.B.A. from Wichita State University.

© 2016 Copyright Ed Carlson - All Rights Reserved

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