While rely­ing on tech­ni­cal analy­sis and chart pat­terns may lack the aca­d­e­mic rigor that fun­da­men­tal ana­lysts (such as Bill Miller) and econ­o­mists (such as Joe LaVorgna) assume, it seems that rely­ing on the real­ity of what is actu­ally going on within busi­nesses is a fool's errand cur­rently. Fur­ther­more, the just-around-the-corner nom­i­nal price action impact of a Fed-driven QE3 expan­sion is on every long-only manager's mind as good is bad and bad is great. As an anti­dote to this enthu­si­asm, Dol­men Secu­ri­ties note two longer-dated chart analogs that should pro­vide some food for thought for the more bull­ish equity investors (which now rep­re­sents the mas­sive major­ity of indi­vid­ual investors). The 115 year Dow chart points to side­ways price action in a broad range to an 80 year trend at best while the ana­log to the wave struc­ture from the 2011 peak in the S&P 500 is echo­ing 2007/8's pre-crash lev­els rather accu­rately. While nei­ther chart por­tends or guar­an­tees an immi­nent precipice, given earn­ings down­grades and the box Bernanke appears to be increas­ingly squeezed in, per­haps they sig­nal the flush that the mar­ket needs as an excuse to ramp up the print­ing press one more time.

While his­tory does not always repeat, it cer­tainly seems to echo.

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