New Support lines for FTSE/DOW

[ReturnKid]

Hi Guys,

I've made a couple of posts in the 'Newbies' section, but this is my first foray into the 'Big Boy's' section so here goes....

As the markets have rallied today I would like to make a hypothesis and see if anyone agrees/disagrees;

FTSE
The FTSE broke through the 4,000 points mark today (closing at around 4,130). My analysis shows that 4,000 was a support level (around mid/late January). This was subsequently broken in February. As often is the case, the previous support level turned to a resistance level around mid/late March. Since the buyers have now punched through the resistance, I hypothesise that 4,000 will return to a strong support level, and consequently we now operating in a new range for the FTSE.

DOW JONES
Similarily the Dow rallied to break the 8,000 points mark today. Per my analysis 8,000 proved a significant support level between mid Jan to mid Feb. This was broken in mid Feb, and after a minor recovery, 8,000 points flipped to a resistance level for a period in mid-late March. Again, my hypothesis is that 8,000 point mark will return to a strong support level.

Thanks for reading, look forward to hearing your views

Cheers,

RK

 

[RedGreenBen]

Hi Guys,

I've made a couple of posts in the 'Newbies' section, but this is my first foray into the 'Big Boy's' section so here goes....

Since the buyers have now punched through the resistance, I hypothesise that 4,000 will return to a strong support level, and consequently we now operating in a new range for the FTSE.

It's always nice to be called a 'big boy'!

Your logic is sound but only until everyone realises that it takes more than a change in accounting rules, a conference and a $trillion to make everything OK again.

So use the S/R you suggest BUT be ready to be proved wrong and don't get wedded to the idea.

Ben

 

[RedGreenBen]

FTSE
I hypothesise that 4,000 will return to a strong support level, and consequently we now operating in a new range for the FTSE.

Told you (my response above).

Ben

(Not being smug, just making the point that it is costly to hang onto even soundly reasoned ideas).

 

[Technically Fundamental]

id say rejection of the 3900 and a pull back to the 38 fib drawn from 31st march 08 is your best bet.

I think we'll be seeing trading below 3800 before we see 4000 again

 

[ReturnKid]

haha, seems like i still have a lot to learn! thanks for the advice guys