Well, here we are again, the Head & Shoulders Top, although not text book perfect, it look s to be in place.

What is interesting is that the Dow Jones Industrials, the S&P 500 and the Russell 3000, are all in sync, and that uniformity is not encouraging.

Important to note in the Charts:

• All have hit the medium term support line resting at essentially the November 2009 and February 2010 lows
• Also MACD has turned decisively negative on them all
• RSI has taken another leg down
• All of this on increasing volume

Decisions Decisions !

Lets face it the Economic data recently has been sour, rumors abound of more quantitative easing and lackluster growth everywhere despite an agressive expansionary Monetary policy.  Whats more, the G20 have agreed to significantly reduce the debt they hold.  Which essentially means cutting back on spending.  Which will affect jobs, consumer spending and in essence this will affect the business climate and ultimately Stock Market performance.

I believe the next few weeks will signify whether the market participants believe in the recovery or not.

If they believe, then the market will rise and eventually break through the 200 day MA (dashed white line)

If they do not (which I suspect) we will see a break down through the medium term support trend line I have plotted on each of the 3 charts above.

Let the market tell you what it is going to do!