Chart Of The Day: Dandruff Time For The Nasdaq?

Tyler Durden's picture

With the world and his mum applauding day-after-day as the nominal price of the major equity indices push to either i) all-time highs, or ii) post-crisis highs; and any and every measure of 'fear' (e.g. volatility and credit spreads) is repressed to limit-zero; there is an annoying glitch in the new market-based reality that has become our barometer of how we feel. Since the 2009 lows, every new market high has been confirmed by the Nasdaq - until now that is - as the divergence between the tech-dominated 'new normal' index and the rampacious Dow Transports or Industrials (dominated by one or two names each and every day) has grown significantly. The worrying chart below, perhaps suggests that the broad Nasdaq index is about to begin the down leg of a major head-and-shoulders pattern - helped by none other than 'most-held' Apple. Are non-Nasdaq indices being driven by the hedge unwinds against this mega-holding?



(h/t Brad Wishak at NewEdge)

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gjp's picture

We'll see.  AAPL may be down but new highs all over the place in everything else.  Amazon leading the charge, with most other major retailers (online and otherwise) close behind.  Action feels like March 2000, but the central banks were actually raising interest rates then.  And we know that will never happen again in history.

This time it's really different.  Doesn't mean this isn't all leading to a crisis, but it might not be a nominal stock market crash.

mdtrader's picture

The NASDAQ doesn't matter anymore. It's all about S&P 500, which is unstoppable, despite Apple.

aint no fortunate son's picture

The problem with pointing out these obvious chart patterns is they become lightning rods for the buy algos to blow up.

augustusgloop's picture

all news is good news for the s&p: entire bet the company fleet grounded? no inkling of what is causing battery fires? BA up over a percent! 

increasing negative cash flows? NFLX up 35-40% 


markettime's picture

I am thinking it is pretty easy to push up stocks in this low volume market. What scares me is the liquidity on the downside. Oh wait we will just halt trading everytime our computers go beserk. 

NoDebt's picture

No, it's just Apple.   ;)

Dr. Engali's picture

Heads shoulders knees and toes...knees and toes..down down down the nasdaq goes..the nasdaq goes....

Oh regional Indian's picture

Poe-yet-tree in "downward" motion Doc... nice...

Cue APPL, Newton, Gravity and inevitability jokes a million.


reTARD's picture

Waiting for the market to get down on her knees, LOL.

beaker's picture

And it is no Head and Shoulder top until the neckline is broken.  

Boilermaker's picture

Yea, it's about to collapse.  MARKET CRASH!!!

I'm sure Bernake will let it go now and won't just jump in and bid up the fucker.

SPX getting ass humped of 1,500 and they just slammed the Russell 2k to new new new all time highs.

But, sure, Nasdaq is for sure going to go to hell.

Shell Game's picture

I remember the clammoring over the summer 2009 HS pattern. Nuf said?  Prechter will be right one of these days, but patterns and waves make me a bit ill anymore.  

gjp's picture

Nothing matters except neverending central bank support, and when the real economy breaks as a result, to the extent that the 'market' has to actually leave the paper orgy and find a way to feed itself.  Who knows when that is.  The elastic band has been stretched far further than I would have imagined possible.

thismarketisrigged's picture

this fraudsters will prob make sure appl closes green today somehow, lol.


good news=market goes up

bad news= market goes up


what the fuck will it take for the market to collapse. fuck u obama and bernanke

Spastica Rex's picture

what the fuck will it take for the market to collapse(?)

A complete redefinition of "market."

LawsofPhysics's picture

I am completely confident that the paper world will be just fine for the next four years.  hedge accordingly.

PUD's picture

Charts do not predict. Charts are history and have no bearing on fortune telling the future what so ever.

magpie's picture

Of course the market will go down...not because Apple is falling, but because NFLX is going up.

orangegeek's picture

Looks like NASDAQ100 completed wave 2 up - yesterday.


Dow Jones and SP500 are riding higher.  And Europe is up across the board.  The divergences are often present at major tops.

BinAround's picture

Call me when the head and shoulders pattern is developed.  So far, it is not.  It lacks the punch down trough the support line at about 62.  Only then will a sell signal be made.



hannah's picture

how did the H&S pattern on the S&P500 around jan2010 work out.....? can the fed fuck T/A again or is it finally out of ammo...?

goldenbuddha454's picture

Apple breaks that neckline between 2-$300 and I'm in!