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Last May key markets in the United States and around the world were creating patterns that two-thirds of the time suggested to pull risk off the table. Why? Rising wedges were taking place around the world, and if one support line broke, they should all fall like dominoes, since correlation was so high. See my May 14, 2011 post, which featured the first chart below.

 

 

Now 11 months later, the majority of this 6-pack is lower in price and the S&P 500 and Russell are creating patterns similar to last year's highs.

 

 

These patterns suggested harvesting some risk assets last year, within 2 weeks of the highs. Current patterns would suggest doing the same again.

 

(c) Kimble Charting Solutions
blog.kimblechartingsolutions.com