Dow Jones: Richtungs-Suche

Consolidating

Dow holds at highs, forms clear consolidation.

The Dow pulled back slightly off yesterday's highs, but is in the process of forming a continuation pattern, which forecasts another push higher in the medium term.

The 15 Minute Chart shows the consolidation spans from 9,970 to 10,075. An upside break from the consolidation is likely and would indicate a sharp continuation higher, especially if 10,100 is crossed. Look for continued sideways movement within the range until a solid break occurs.

A downside break from the consolidation is still possible, and would likely spark an equally powerful move. Watch for a solid crossing through 9,950 to indicate that the recent lows will be tested at 9,850.

Short Term Dow

Short term, the Dow ended the day just above short term support at 9,970, seen in the 5 Minute Chart. Watch for strength above this level, unless a downside break occurs.

Medium Term Dow

In the medium term, we covered Shorts today at 10,050, giving us a nice total of 130 points for the trade. We then entered Longs at 10,050, but stopped out for a 20 point loss. We are now out of the market and will watch 9,950 down, and 10,100 up, with 20 point stops.

NASDAQ & S&P

The S&P and NASDAQ each held on to most of yesterday's gains, forming a tight range at the highs. Watch for a break from the consolidation for movement tomorrow. *

Summary

The Dow ended the day near the highs of the session, within the boundaries of a tight consolidation. The consolidation implies a continuation higher in the medium term, especially if 10,100 is broken to the upside. However, a break either way should provide nice direction. Watch the boundaries tomorrow.

Thanks for listening, and Good luck in your trading..

Ed Downs
edowns@nirvsys.com

with assistance from..
Frank Ochoa, Market Analyst
fochoa@nirvsys.com

** 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