AEX Alert: Possible Top

The AEX is 1 point away from the upper Jupiter channel line. This line is at 371 on Tuesday, slowly climbing to 372 on Friday. The AEX is in a similar situation as May 2012 where the Lunar Eclipse right after the Solar Eclipse triggered a trend change. See bottom image. In that case, the AEX bounced of a Jupiter channel line as well. The Lunar eclipse this week is Saturday May 25th, so Friday May 24th would be ideal. Also note that volume started to decline since the beginning of May (blue line), indicating a weakness in the uptrend.

The preferred outcome would be a top this week followed by a pretty rapid decline (yellow arrow bottom image).

Alternatively, the AEX might do one more ‘down-up’ move (blue arrows image below). This is similar to March 2012, where the index briefly breached the Jupiter channel, retreated for a bit, and then made a perfect hit.

Note that all the Jupiter hits (circled) are important points in the AEX Elliott wave pattern. For the wave labeling see previous posts.

We will find out very soon.