The DOW: Is that it?

[Riz]

As this thread is going to be a continuation of my last week post on the Dow, I'm shifting that post here so the two chart can be viewed together:

"The continuous higher lows forming a bullish wedge on the 5 min was suggesting a safe bet to go with an upside break which finally occured after a few weak trials....

We've ended up with another expanding triangle on the daily chart suggesting more volatility ahead...only the upside sloping support line, the engulfing white candle on the daily chart, the higher low on the 15 min chart formed on the pull back after the rally to 10k, the hammer again on the 15 min chart, consolidation at the high on the 1 min chart all suggesting more to the upside before a downside move, still expanding triangles refer to volatility and it might be relatively safer to go with higher lows rule intraday... " (23-02-2002 04:20 PM)

 

[ChartMan]

Could we just be making a "Diamond" here.? gonna look later.

 

[Riz]

Well the triangle has broken upside on a very strong rally, turning all major resistance levels into support, the most meaningful and critical of which the 10300 level...also moving well above its 200 day Moving Average.

Considering this impressive move together with the continuous +ve news flow with regard to the US economic recovery, one can see strong signs of the end of the bear market, and wonder if that's it...

The new patterns forming on the Dow charts on various timescales are suggesting although such a move of more than +260 points up would normally start a retracment, a consolidation above 10300 could easily take us over 10400 as the upper boundary of the upchannel still allows that...

On the downside it looks like we can rely on the 10300 support level which used to be the most critical resistance level...even below that we still got 10225 level which can provide strong support...but overall further up before a retracement to lower boundary of this last upchannel looks more likely...the bounce off 10360 right before close and the 1 min rsi also suggesting this...

Whatever, the picture looks pink now

Riz

 

[Riz]

Another strong upside break

Dow finally broke the downchannel carrying on for over a month, the move looks too big and decisive on high volumes...normally one may expect a pull back after such a big move, only I remember dow scoring two +200 days followed by a +100 day, I therefore wouldnt be surprised if it follows through tomorrow, maybe after a modest retracement, then up we go probably to test the resistance line...I dont see a good shorting position till it either pulls back to the downchannel or hit and retrace the resistance level...whatever it's great to trade the Dow and hope everyone enjoyed todays rally

Riz

 

[Riz]

Couldnt help updating the daily chart seeing the level Dow retraced to...right at the upper line of the downchannel that was broken yesterday...consolidation above that channel is bullish and provides potential upmoves, only could this be the kiss off death or life? it's also very close to the 10k major support level, thus providing some significant levels to watch tomorrow, such as a bounce off the upper boundary of the channel or off the 10k major support or break of 075 or 100 to consider longs, and alternatively strong break down of 10k to consider shorts...some of significant levels I'll be watching tomorrow...it's also worth to mention the rsi on the daily chart using 50 line as resistance, again upside break of this line could be significant enough to consider a long for me...

Riz