Summary
This email reviews Phil Anderson’s March call for a Dow Jones top near 35156, noting the actual 10 May high of 35091 (65 points off forecast), and assesses whether the subsequent decline constitutes a Gann “overbalance” — the key condition required to confirm May as a longer-term market top. Multiple global indices (Nasdaq, ASX XAO, FTSE All Share) are reviewed against their 2021 forecast curves, with the email concluding the long side appears to be tiring but overbalance has not yet been confirmed.
Key Claims
- Dow Jones hit a high of 35091 on 10 May 2021, against a forecast top of 35156 — a miss of 65 points — confidence: high
- A lower top formed on 14 May, with a potential second lower top on 21 May yet to be confirmed — confidence: medium
- The 2021 forecast curve (20-year and 60-year grey lines) suggests the possibility of a further lower high in June — confidence: medium
- For May to be confirmed as the longer-term top, the Dow must “overbalance” — the retrace must exceed both the number of days down and points down seen in any prior leg up from the 23 March 2020 low — confidence: high (as Gann methodology)
- As of 24 May 2021, neither the Dow nor the Nasdaq had overbalanced to the downside — confidence: high
- The Nasdaq turned on 29 April 2021 but had also not yet overbalanced — confidence: high
- Australia’s All Ordinaries (XAO) formed a double top on 10–11 May and reversed — confidence: high
- The UK FTSE All Share also reversed on 10 May — confidence: high
- All reversals were consistent with the respective markets’ 2021 forecast curves in the Stock Market Road Map report — confidence: medium
Mex Pete References
None.
Stock Picks / Signals
None.
Predictions / Forecasts
- Dow Jones forecast top: 35156, anticipated in early May 2021 (actual high: 35091 on 10 May) — sourced from Gann Email #00, April 06 2021
- 2021 forecast curve suggests possibility of a lower high forming in June 2021
- Longer-term bearish confirmation requires Gann overbalance to occur off the 10 May high; not yet triggered as of 24 May 2021
Notable Quotes
“On a longer term basis, for the market to confirm it will go lower the rest of the year, and therefore confirm May as the actual top, we need to see what Gann called his ‘overbalance’ take place.”
“Gann discusses ‘overbalance’ in his book How to Make Profits in Commodities, from about page 309 onwards, ‘Time Turns the Trend’. There isn’t a lot more in markets better to understand than what Gann discusses here, as regards how to ‘read’ a chart.”