Dow

[Stranger_Danger]

That was some Obama rally, huh?

There were apparently 1 million people on the streets of Washington for the Obama inauguration. Early reports are that only 50% of these were homeless, the rest came for the show.

[airedale]

Good morning, Doc, you may be right. One of the most colouful comments I have seen about the 8,000 level is that " it is like standing at the edge of the abyss". If it falls from there who knows how far it may fall.

[ananda77]

...still consolidating, trading to >83, well >82.4 support/resistance; likely to test 85-level;

Kind Regards

USD broke through the 85-level, up 1.2% to clear 86;
-deepening recession/depression
-precious metals up

Kind Regards

[Dr_Who]

Dow 7940 as we speak. If it closes below this, game over! ouch we come. If only I had a short on the Dow, again I was not brave enough.

I really dont see any light at the end of the tunnel.

[Stranger_Danger]

Late rally from the PPT to take us back over?

[Hoop]

My post #171 (15 Jan 2009) showed a poor quality chart of the TA break down of the DOW when it broke 8200 pointing to a possible downturn.

With rather strong support bands around the 8150 and 8000 there was a good chance that the DOW might bounce upwards off these supports...However hindsight has proven that the selling pressure was stronger than the supports.

Now with very little resistance between the 8000 old support band (new resistance) and the bottom, any much less selling pressure could quickly send the DOW down to retest the bottom (7449 intraday 20th Nov). It would need selling pressure to totally disappear tomorrow for the DOW to bounce up and create a weak 7950 support line. Much more buying pressure is now needed than a fortnight ago to propel the DOW higher because the DOW has the old broken supports of 8000 8150 and 8400 as strong resistance bands now.

Note the squeezing up of the Bollinger bands (purple lines) a week ago indicating a trend change and the start of them widening with the resulting downtrend


Ananda...traders on the Wall st floor today were quoted as saying that the 818 support break (your 816 was spot on) of the S&P 500 today has triggered another wave of selling.

Things are now a lot more gloomer than a couple of weeks ago (TA wise).

The question now being asked is ...are we still in a bear market with this 9 month USA recession still not yet half way through? A break below the Equity market bottom (20 Nov) will send analysts re-predicting a early 2010 economic recovery as apposed to the mid/late 2009 period recited at the moment

Below is my post #171 chart updated but without today's drop/support break (7949). All the middle orange 3 support lines have been breached and are now resistance lines.

Chances of a new bottom forming have increased since last week.

[ananda77]

Hoop:

...we are definitely not in a bull phase now... and a long way away from a long term upside reversal to a bull market

Kind Regards

[Hoop]

Hoop:

...we are definitely not in a bull phase now... and a long way away from a long term upside reversal to a bull market

Kind Regards

Ananda... How can you be so sure!!...You may be right of course.... but you may also be wrong [we may already be in Bull market (phase 1)]......no-one can be 100% sure...because no-one can pick this bottom of the this market accurately 100% of the time. You are using what information you gather, analysing it to forecast a prediction, that is all.....unless you have a time machine at home, you have no accurate future figures to reference with. You may be good at analysing and forecasting, but there is a good chance you may be wrong.

To illustrate my point see the 15 year DOW chart below which contains 3 1/2? market cycles 2 Bulls 1 Bear and the latest incomplete? cycle
The 3 (4?) yellow arrows point to the situation after the cycle change from Bull to bear and from Bear to Bull...you notice there is little change from end of Bull to start of Bear and likewise from bear to Bull...




At these points (yellow arrows) the investor is not guilty of denial, its just that the market cycle change which has just happened, can be too hard to identify at that time of its occurrence. It is easy in hindsight and Analysts/Historians use this hindsight to accurately record the start and finish of each of these cycles to the exact day. The problem we have this time (as it always is) Ananda, is, you and I + all others have no future figures to establish the exact date of an end of this current Bear Cycle. We can only give it a guess using current happenings + events signals from previous Bear cycles and with caution, as some of those historic event signals may not work this time..who knows??...

PS.... Just look at Sharetrader posts around Nov-Dec 2007...very few believed we were in a bear market, and put forward very logical explainations that the Bull was still alive...yet in reality we were in Bear market cycle (phase 1) at that time and most investors did not know it.

PS 2..Major event changes and the lag effect theory

[Hoop]

Just to add some info to my above post which I wrote then deleted yesterday before posting (to save being a long-winded post + create confusion)

Without future sight a bear market is deemed over when:

...from a TA point of view...when the primary downtrend line is broken (around 11700 on the DOW at this moment or resistance line on an inverted head and shoulder pattern usually around the same level in this case at 11150 or an alternative "suitable" downtrend line in this case the 8 month downtrend line around the 10000 mark presently may qualify. (as time goes by these downtrend line figures become lower).

...The Coppock indicator rising back above zero

...from the official point of view it is 20% higher than the bottom value (closing price I suspect ) so somewhere around 9200 mark.

I guess this is what Ananda is referring in the post... quote "...we are definitely not in a bull phase now... and a long way away from a long term upside reversal to a bull market.."

[Dr_Who]

Is this a dead cat bounce?

The fundamentals have not changed.