| Updated 7/21 for Tuesday's market. |  | ||||||||||||||||
Still in the RangeDow turns back within large triangle, consolidates at the lows.From prior commentary, "...As we have mentioned before, we will likely see continued trading range activity within the range boundaries until a clear and decisive break from it occurs..." Friday's rally was quite impressive, but was short-lived and showed the volatile nature of the wide trading range in the Daily Chart. The Dow sold off Friday's highs and pushed back down toward the lower boundary of the range today and went on to form a tight consolidation at the lows of the 15 Minute Chart. The fact that the index continues to "wind up" within the consolidation boundaries indicates that it is now ready to make a solid move. A downside break of the lower trend line is very likely to spark a sharp decline, while an upside break through the top of the range at 9,250 is likely to stir another solid push higher within the major uptrend. These are our two primary fulcrum points to watch. However, the Dow has formed clear consolidation boundaries from 9,075 to 9,120, seen in the 15 Minute Chart. A break from this range will likely give us a clear indicate of strength fairly quickly. Watch this range closely tomorrow. Short Term Dow Short term, the Dow has formed a clear short term support level at 9,075, seen in the 5 Minute Chart. Use this level as a fulcrum for direction tomorrow morning. Medium Term Dow In the medium term, we closed our Long positions at the Open at 9,150 this morning, which gave us a 35 point gain for the prior trade. No other trades were taken and we are now out of the market. Watch 9,075 down, and 9,120 up tomorrow, with 10 point stops. NASDAQ & S&P The NASDAQ got the downside break from the trading range today, while the S&P turned down off resistance. The S&P also got the downside break of the major lower trend line, which could hint at further weakness. * Summary The Dow moved sharply off the highs today and trended lower throughout the session. The index has now formed a tight consolidation at the lows, which we will watch closely for a break. Watch 9,075 down, and 9,120 up tomorrow. 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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