The Dow Jones Industrial Average hit all-time highs last month. Since then it has been consolidating its gains. More importantly, the index broke the ascending trend line from the COVID lows back in June. However, the index didn’t turn bearish at that point. It grinded higher and consolidated all summer.
Today, the index is parked on another ascending trend line since February 2021. Arguably it is this year’s “trend.” We feel it is important to start monitoring for near-term weakness, especially as the RSI points lower as it has been divergent since the spring.