| Updated 9/24 for Monday's market. |  | ||||||||||||||||
Consolidating..Dow trades sideways, forms consolidation at lows.From prior commentary, "...The fact that the Dow has sold off heavily the past two sessions indicates that we will likely see a period of consolidation before the next clear move occurs. Look for the index to pull-back from the current lows tomorrow, forming the framework for a wide consolidation..." The Dow traded sideways the entire session today, forming a clear consolidation at the lows of the recent decline, as seen in both the 15 and 60 Minute Charts. The index closed the day higher by just 8 points, but may be gearing up for an even larger move soon. The fact that the consolidation has formed at the recent lows implies further weakness in the medium term. A downside break from the consolidation at 10,030 will likely make for another steep decline in the market. However, a break either way from the range should provide solid movement. Watch 10,080, as an upside push through this level will fuel a reaction rally Monday. Look for further consolidating before another move occurs. Short Term Dow Short term, the Dow has formed a tight range at the lows of the 1 Minute Chart from 10,042 to 10,048, which we will watch closely Monday morning. A downside break is the most likely scenario, but a break either way should offer direction at the Open Monday. Medium Term Dow In the medium term, we are still Short the Dow from 10,165 and will move our stops down to 10,085, locking in 80 points in the current trade. We will want to stay Short below 10,030, and will look to enter Longs above 10,090; using 20 point stops. NASDAQ & S&P The NASDAQ traded in volatile fashion today; while the S&P ended the day within the boundaries of a tight consolidation. Each index has formed a range to watch for Monday's market, but expect further sideways movement ahead of the break. * Summary The Dow traded slowly sideways the entire day today, forming a tight range at the lows of the recent decline. A downside break is implied Monday, but a break either way should yield solid movement. Look for continued range movement between 10,030 and 10,080 before a break 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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