Denial is not a river in Egypt

Dow Jones Industrial Average rallied, suggesting a second higher low above primary support at 10600/10800.  Expect a test of 11900/12000, but this does not mean the bear market is about to reverse. We are still in the early “denial stage” of the bear market, identified by sporadic bargain-hunting, high volatility and a general lack of direction. Declining volume indicates a lack of enthusiasm from buyers and sellers. Failure of primary support would change that, leading to a sharp fall to 10000*.

Dow Jones Industrial Average

* Target calculation: 11000 – ( 12000 – 11000 ) = 10000

7 Replies to “Denial is not a river in Egypt”

  1. Hi colin

    I have been with you for about 4 – 5 years know I would love to know what indicators you think are the best to use, the most consistant?
    Also would you think of adding an indicator which would help identify cycles?
    Regards Terry Hand

    1. Twiggs Money Flow of course 🙂
      Seriously, I seldom use more than Money Flow and Momentum.
      For shorter term trading, Stochastic or Williams %R, RSI and Aroon would be my picks.

  2. I thought the first resistence was at 11700 with the major at 11900 (line through the higher highs) with the first support at 11100 (line through the higher lows). Totally agree that should the 10800 give then 10000 is the next target. Really love your site and comments and find them very helpful the the volatile market. Thanks. Shaero

  3. Hey, we live in Australia. We’re not Americans. How about looking at the ASX and not just the DOW!

  4. Look to me as if the DOW weekly and daily charts have formed a flag pattern. Which would suggest a continuation of the downtrend that commenced in July. Is this so or im i seening my own stuff?

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