I've seen a number of posts by technicians pointing out that the next resistance on the Dow Industrials is around 16,000 where the upper trendline is. Some of those posts then speculate the market will launch through the trendline after a modest correction.
Well, I would point out that the ETF for the DOW 30 has already hit the upper trendline.
I would also point out that the last major megaphone pattern was back in the 1966 to 1973 period. In the S&P, the market never made it to the upper trendline. After the 1973 peak, the market melted down into the 1974 low and took out prior swing lows of the pattern in the process.
There are no guarantees when forecasting market movements, but the weight of the evidence I'm looking at (and have posted over the last few months) suggests we follow the path after the 1966-73 megaphone pattern.
Kim Rice 9/8/13
