Is S&P 1044 point 23?

(This pattern was discovered by George Lindsay and was described by him as an emotionally driven phenomenon. It also mimics the pattern prior to the crash of 1929. The following text was taken from Mr. Lindsay’s Selected Articles. -AM)

The advance after point 20 is called the Wall of the Second Story. After the Wall runs its course at point 21, the average hesitates a while and touches point 22. Then, it spurts to 23 but quickly falls back to 24, retracing practically the whole gain. When drawn on a chart, these movements suggest a cupola or small dome on the top of a building. Hence, the whole formation is called a Domed House.

Prices hold up, or rally a little, until point 25. A horizontal line drawn through points 21 and 25 suggests the Roof of the Second Story. An abrupt decline follows 25, and then a recovery to 27. This point often falls at a level which suggests that it is the right edge of the Roof of the First Story, which began at point 15. If the top pattern is viewed as a head-and-shoulders formation, either point 25 or 27 may be called the Right Shoulder, depending on which one is more prominent on the chart.

Following point 27, the average drops abruptly and returns to the level of point 10, or within a very few points of it. Sometimes prices get back to the starting level in one continuous downtrend, and sometimes there are extended recoveries on the way down. But there has never been and exception to the rule that the entire gain in a Domed House has eventually been canceled.

Note that the advance from point 14 to 15 is balanced by the drop from 27 to 28, and the rise from point 20 to 21 is offset by the spill from 25 to 26. This gives the chart pattern a squarish effect, suggesting the walls and roofs of a building of two stories. At the same time, there is a rounded effect at the top such as a cupola might give. The whole formation becomes a Domed House.