| Updated 9/30 for Friday's market. |  | ||||||||||||||
Pull-BackDow pulls back from highs, ends session lower.From prior commentary, "...The fact that the Dow has now broken through resistance at 10,100 implies strength in the near term...Look for the Dow to remain strong above resistance tomorrow...Otherwise, a break back below 10,100 will make for another wave lower, especially if 10,080 is violated..." The Dow opened the session sharply lower this morning, as the index broke back below 10,100 en route to a 56 point loss. Looking at the 60 Minute Chart shows the index is forming an upward-sloping consolidation at the lows of the recent decline. Look for the index to continue trending slowly higher within the boundaries until a break occurs. A downside break is the most likely scenario and would spark another steep decline. Watch 10,050 down tomorrow, as a break here could make for vast weakness. However, further sideways movement is indeed likely, and could make for another wave higher toward 10,160 before serious activity occurs. An upside break through 10,180 will indicate an even further advance higher. Short Term Dow Short term, the Dow has formed a clear trend line beneath the lows of the 5 Minute Chart. Watch for continued strength above this line tomorrow morning, unless 10,050 is crossed to the downside. Medium Term Dow In the medium term, we entered the market Short this morning at 10,043, but stopped out with a 20 point loss. We are now out of the market and will watch 10,050 down, and 10,180 up; using 20 point stops. NASDAQ & S&P The NASDAQ held at the highs throughout the session; while the S&P traded in volatile fashion. Each seems to be forming an ascending consolidation, which is typically seen as bearish. Look for continued sideways movement before a break occurs. * Summary The Dow opened the vastly weaker this morning, but pulled back off the lows for a lighter loss on the day. The index looks to be forming a bearish pennant consolidation, which will likely continue to develop tomorrow. Watch the boundaries closely, as a break should lead to solid movement. 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 _________________________ |
| ||||||||||||||
