Posted on by ColinTwiggs

Dow threatens decline to 10000

Dow Jones Industrial Average is testing the band of support between 10600 and 10800. An up-tick in volume indicates some buying support but this appears insufficient to withstand downward pressure. Failure of support at 10600 is likely and would signal a primary decline to 10000*.

Dow Jones Industrial Average

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

The S&P 500 index is similarly testing support at 1100, while 21-day Twiggs Money Flow declining below zero warns of selling pressure. Breach of 1100 would signal a primary decline to 950*.

S&P 500 Index

* Target calculation: 1100 – ( 1250 – 1100 ) = 950

The NASDAQ 100 is headed for a test of support at 2040. Reversal  of 13-week Twiggs Money Flow below zero warns of a primary down-trend. Breach of support would signal another decline with a target of 1700*.

NASDAQ 100 Index

* Target calculation: 2000 – ( 2300 – 2000 ) = 1700

7 Replies to “Dow threatens decline to 10000”

  1. come on .. as per current economic outlook in USA, how could DOW has still been sitting above 11,000? it should have trade between 7800-9400 yeah! as long as they are not diving.. Ord be trading lower to 3600!

  2. Both the Dow and S&P show rectangle continuation patterns which suggest the continuation will be in the direction preceding the rectangle.
    So Dow to 9800 and S&P to 1000 – at a minimum.

  4. Colin, what you left unsaid is pretty scary. Can you share your thoughts on the “primary down-trend?” Last I heard Richard Ross threw out a number of 850 for the S&P in the not too distant future. Thanks! (PS – I’m an Incredible Charts subscriber and think what you offer is just amazing for the price (ka-ching!)

    1. Thank you for your support. I am not sure how far this will go, but the global economy is in a mess. Fiscal stimulus has been wasted and now public debt is too high for effective action. QE has failed to revive the economy, merely lifting inflation expectations — causing a bull run in stocks and commodities. Future direction of the market will depend on whether the Fed changes their mind about QE3.

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