It will be volatile in this news driven market through early next week. If the ECB is pressured (duh) into trying to stem panic, and some fool comes out to the media with a PROPAGANDA statement like "We will find another way to help Cyprus that does not impose on depositors..." then there might be a little more upward movement on faux "relief". But who knows what the next headline will bring? It's hard to imagine any news good enough to sustain this exhausted market in the short term.
THE top? Which top? The top for all time? The top of the morning (to you)?
One thing's for sure: IBDMAHN15 thinks the top is in, and he's been thinking it for a couple of years.
All kidding aside, the tape speaks of the bigz distributing stock into the surges. Longer term, it is much more ominous the longer they hold ranges near the recent market highs --- what the old school technical analysts summarize by "the broader the top, the steeper the drop". This is why the neophytes on this board (and elsewhere) who are always looking for a KAH-RASH! keep getting disappointed: markets do NOT typically KAH-RASH from new highs or even double tops. First they have to distribute, or, as several of the smart guys here have repeatedly pointed out (among them, ChickyMahn): "topping is a process". Yes, you very often see a reversal on volume, and that can often mark the actual top (and there's nothing better than an island reversal in that regard), BUT that is just one part of the topping process usually.
So when do markets typically KAH-RASH? Well after the distributional stall. During the stall, there is no fear among those who are bullish, because they are not losing money. Following the stall, the decline begins, and it starts on low volume, and neophytes think that means it's nothing to worry about. But then volume accelerates and price declines get more dramatic, and the formerly complacent go on high alert, but they don't want to sell below the highs and be faced with smaller profits than they could have had just a short time ago. And thus begins the sliding down the SLOPE OF HOPE.
But back to the question: when do markets KAH-RASH? Typically that doesn't happen until the decline has been going on for a while and those who were ever so confident and complacent are now ready to PANIC!
So how do the Weeners identify tops? We look for volume reversals (especially islands), but mainly, we are looking at curvature (and bottoms are not much different).