huntley says, page-13

its also interesting that if you draw an internal line that touches the dow highs of years 1971, 73, 87, and the lows of 2002 and 03, then it also suggests lows about now (its an ascending line) to dow 10150. If that is as far as the decline descends - to where it touched that internal trend line, then we'd be looking at a continuation of this massive bull run that started with the 70- 74 double bottom.

At the same time, its also fascinating that if you use the 70-74 double bottom and the 73 high as your starting points for another median line, and extend that through to current day, then it actually coincides with the internal line described above at about 10,200 right now.

So, which is it to be.. the bullish index scenario with implications of hyperinflation, or the bearish index scenario with its implications of a responsible fed and low inflation? Looking to my old mate the rsi for inspiration.. In the most recent rally peak the rsi touched its very long term internal line from below and retreated. This long term trend line fits under all the lows from 1974 through 1997, before breaking the line (down) in 98, rising above it later in 98, and finally plunging below it in 00. Since 00 the rsi has not approached the trend line again until a few months ago.. and has respected the line. There is some clue however in the overbought status of the rsi until recently. It was divergent at the recent highs and overbought. This was the first divergence since the start of the bull in 03 (as posted previously) and the first time it has been overbought since Dec 99. This suggests that the current test of the intermal rsi line from the oversold low of 74 has failed.

I conclude that a crash about now would possibly reach dow 10,200. This coincides with support from the lows of previous dow congestion zone of the 99-01 period. A slower decline into january 09 could see dow find support at the old high about 11500.

So there you have it.. mathematical analysis using the median line, plus momentum analysis, over a 36 year period suggest that we've seen the highs of the dow for this cycle. There is one bullish scenario, but its a blowoff scenario and probably would need to coincide with hyperinflaton to be realised. cheers!