It is also important to note that the major averages are currently tracing out either a massive head-and-shoulders top or a potential double bottom pattern. There are two possible scenarios from this point: the market will trade above the middle of the “W” (dotted line shown above) or it will take out the neckline of its H&S top (recent lows, not shown). Only time will tell which pattern prevails. Patience is paramount until either pattern resolves itself. Trade accordingly.