DOW on 25 May 2005 & X Factor

asarda007

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Hi there,

Please see attached graph of DOW (up until 24 May 2005). I wanted to confirm and get opinion - based on the trend-line in the graph there seems to be two support points (should the DOW starts falling): first one on 480 and second around 450.

My question is.. based on this would it be advisable to short DOW if it hits 440 today (or later this week). The next serious support comes in at around 200 (based purely on charts).

Also, I wanted to get some idea of how far should we place a trade if we were basing trades on charts. I suppose what I am asking is how to avoid false break outs (either going up or down). And where to put stop loss. Is there an X-Factor?

Thanks in advance for your replies.
Regards.

Adi
 

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