Did the Dow break above the 3 year down trend line?

I have attached the 3 year chart of the Dow and drawn the 3 year down trend line on it as you can see above. Did we break above it? It is the question of the day as investors determine whether we are going to make a significant move up on the Dow and other indexes. The answer to the question depends on something usually not apparent. It depends on the thickness of the line I drew. If I use a standard 2.0 weight line, which is the weight of the line I have been using since drawing these charts, the unexpected answer is No! If I use a 0.5 weight line, which is almost the thinnest weight line I can draw using Powerpoint, the answer is Yes! So how does one decide whether to Buy into this rally at this late stage or not? You wait for a clearer breakout.

I know everyone is going to be screaming at me about this, but the signal is not yet clear that we are going to rise to 11,000 or higher on the Dow at this time or if we are going to retreat and have a correction. I know that sounds wimpy, but I only want to use data to decide, not my emotions. So there you have it. I will continue to use this thinner downtrend line when I draw this chart in the future. But when I can't say something for sure I look for alternative measures. In this case I give you the 3 year chart of the SP500. On this chart below, you can see that we have not broken the 3 year down trend line. That adds to my caution in telling people we are going to go up. If the S&P 500 also broke through this down trend line, I would be more optimistic.


I hope this helps understand why I have not declared that we are going up.