Erik's blog suggested the possibility of the evolution of a massive head & shoulders pattern. This chart demonstrates the interrelationship of the NASI, VIX & the $NDX price & Chi Oscillator. The Chaikin Oscillator is the Moving Average Convergence Divergence indicator (MACD) applied to the Accumulation/Distribution Line. The formula is the difference between the 3-day exponential moving average and the 10-day exponential moving average of the Accumulation/Distribution Line. The Chaikin Oscillator is an indicator to predict changes in the Accumulation/Distribution Line. Since May, the Complex NASI Top has been associated with the development of left shoulders & heads (blue & purple boxes, respectively). An Uptick Notch (blue arrow) has been associated with the right shoulder (orange boxes). Chi Osc goes up & VIX goes down when the head & shoulders ($NDX price) are rising up.
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