Chart Patterns and TA

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>>> Market timer McClellan sees sharp stock-market selloff 'beginning imminently'


MarketWatch

Dec. 30, 2021

By Tomi Kilgore


https://www.marketwatch.com/story/market-timer-mcclellan-sees-sharp-stock-market-selloff-beginning-imminently-2021-12-30?siteid=yhoof2


Market timer Tom McClellan, publisher of the McClellan Market Report, warned of a "sharp drop" in the stock market "beginning imminently" and continuing for a couple of weeks into January.

Among reasons for his view, chart signals suggest the recent rally in the Dow Jones Industrial Average DJIA, +0.03% and S&P 500 SPX, +0.03% to record highs appears to reflect a "blowoff exhaustion"; negative divergence in the advance-decline line, which showed most stocks were declining while the indexes rose; and the fact that the annual seasonal pattern shows a tendency for the Dow to fall during the first two to three weeks of January, McClellan said in a newsletter sent to clients overnight.

McClellan said he's bearish short-, intermediate- and long-term trading styles. The Dow was up 27 points, or 0.1%, in afternoon trading Thursday and on track for a seventh straight gain and second straight record close. Meanwhile, only two of the Dow's 30 components -- UnitedHealth Group Inc. UNH, +0.15% and Coca-Cola Co. KO, -0.07% -- have reached 52-week highs in intraday trading on Thursday, and only eight components have reached 52-week highs this month. For the S&P 500 SPX, +0.03%, which was up 0.1% and in record territory, 12% of its components have reached 52-week highs on Thursday, and 27% have reached 52-week highs this month.

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