| Updated 4/21 for Friday's market. |  | ||||||||||||||
Bounce at 10,000Dow gets sharp reversal at 10,000, rallies steadily to the Close.From prior commentary, "...Given the geometry of the pattern, look for the index to continue lower toward a target of about 9,850. However, the index may struggle with a break at 10,000, as this level is quite a psychological level in the charts..." It looks like the Dow was having none of the 'breaking 10,000" talk, as the index reversed sharply off the psychologically important level en route to a 206 point gain. Today's one-bar wonder on the Daily Chart, the biggest in two years, indicates that we may see further strength back toward broken support at around 10,360. Given today's snap-back reaction to recent declines, we will likely see further upward momentum. However, the fact that today's gains were so powerful, we may see a continuation pattern form before another large advance is seen. A consolidation is very likely to form at the highs before additional strength is seen. Watch for such a pattern to form above 10,100. Otherwise, a break back below 10,100 will indicate another wave lower within the volatile range that has developed at the current lows. Short Term Dow Short term, the Dow has formed a clear trend line beneath the lows of the 1 Minute Chart. Watch for strength above this line, unless 10,200 is crossed to the downside. Medium Term Dow In the medium term, we covered Shorts at the Open at 10,100, giving us a loss for the trade. We later entered Longs at 10,200 and are still in the trade. We will continue holding stops at 10,180 and will want to stay Long above 10,250. We will hold off on Shorts, unless 10,100 is crossed to the downside; using 20 point stops. NASDAQ & S&P The NASDAQ and S&P each popped right from the Open this morning, but really followed-through later in the day. Each is holding at the highs, but look for a continuation pattern to form to indicate further strength. Summary The Dow rallied right from the Open today, sparking a steady advance to the Close. The index ended the day higher by 206 points, indicating that we may see further overall strength in the medium term. However, look for a continuation pattern to form at the highs before such strength is seen. Thanks for listening, and Good luck in your trading! Ed Downs with assistance from.. ** Note: We are now posting Index entries and exits in Real Time, through our new Intraday Index Alerts service. To learn more about the service, visit SignalWatch.com and select Intraday Alerts from the main navigation bar. - SW Team _________________________ |
| ||||||||||||||
