| Updated 10/20 for Thursday's market. |  | ||||||||||||||
Support at 9,800Dow hits 9,800, holds above key support.From prior commentary, "...the Dow has reversed down off a clear upper trend line, which has formed across the highs of the last two weeks. Look for continued weakness below this line, unless 10,000 is crossed to the upside. A break below 9,860 will make for an even steeper decline..." The Dow opened the session lower today, getting a break of 9,860 to spark the early downmove, as seen in the 15 Minute Chart. The index trended down to the key 9,800 support level, which it held above the remainder of the session, as seen in the Daily Chart. The Daily Chart shows the Dow has made its way back down within the boundaries of the wide, downward-sloping channel. If the index breaks below support at 9,800, the Dow is very likely to touch the lower boundary of the channel at around 9,725. However, if the index breaks back above 9,900, we could see a short term upmove toward the clear upper trend line at around 9,975. An upside break through this line will indicate even further strength through 10,000. Short Term Dow Short term, the Dow ended the day just below key short term resistance at 9,900, seen in the 5 Minute Chart. Look for weakness below this level tomorrow morning, unless an upside break occurs. Medium Term Dow In the medium term, we are still Short the Dow from 9,900 and will move our stops down to the entry for tomorrow's market. We will want to stay Short below 9,820, and will hold off on Longs, unless 10,000 is crossed to the upside; using 20 point stops. NASDAQ & S&P The NASDAQ and S&P each sold off early in the session, but reversed sharply to the upside for the second straight session. Watch the tight range from today's trading for breaks tomorrow. * Summary The Dow closed the session slightly lower today after holding firmly at major support at 9,800. A downside break through 9,800 will indicate a continuation lower toward the bottom of the major channel. However, we may see a rise through 9,900 before another big drop occurs. 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 _________________________ |
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