Yesterday morning I was talking about the volatility of the index and the magnitude of the last great candles (Marubozu) expressing this volatility ... A few hours later all the lights are red. With the loss of 225 points for the Dow, this represents the largest candle bearish since last February 5 , then the downward volatility was at the rendezvous, is the least we can say.
I mentioned again yesterday morning the importance of the support area of 10.988 points , I indicated that this area was medium to observe carefully to determine a reversal potential of the current uptrend in the index. The downward break of the support area of 10.988 points was validated in closed sessions, then a bearish reversal is currently in court.
The Dow has finished his daily race with a difference of only 4 points over the area of 23.6% Fibonacci located at 10.922 points, breaking the retracement will add further validation to the downward movement. On breaking the 23.6% fibo direction area of 10.715 points, the previous high of last January or area fibo 38.2%. A "Pull Back" on the area support 10.988 points (movement back on an area support become resistance), then a downward relapse is a possibility that would consolidate the downward movement already underway.
The long-term moving average of 150 days is currently located at 10.385 points and also corresponds to the area of the Fibonacci 61.8%, which could be the last stronghold of the bearish zone of the curve points of the index and maintain all well it a positive direction for the long term.
Conclusion: on breaking the 23.6% fibo management area of 10.715 points and then the 50% retracement is at 10.550 points to observe if the downtrend continues.
The Dow has finished his daily race with a difference of only 4 points over the area of 23.6% Fibonacci located at 10.922 points, breaking the retracement will add further validation to the downward movement. On breaking the 23.6% fibo direction area of 10.715 points, the previous high of last January or area fibo 38.2%. A "Pull Back" on the area support 10.988 points (movement back on an area support become resistance), then a downward relapse is a possibility that would consolidate the downward movement already underway.
The long-term moving average of 150 days is currently located at 10.385 points and also corresponds to the area of the Fibonacci 61.8%, which could be the last stronghold of the bearish zone of the curve points of the index and maintain all well it a positive direction for the long term.
Conclusion: on breaking the 23.6% fibo management area of 10.715 points and then the 50% retracement is at 10.550 points to observe if the downtrend continues.
previous analysis
http://observateurtechniqueindices.blogspot.com/2010/05/dow-jones-3-mai.html Posted by Claude Bordeleau
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