ShareCast News

TA: Dow Jones: Starting the engine?

Wed, 16th Nov 2011 16:29

We will be closely monitoring the three major Wall Street stock indices because they could soon initiate a new leg up in search of resistance at the year's highs. In fact, the Nasdaq-100 seems to want to fire the starting gun already. Thus, and in broad brush-strokes, when we look at charts what we see is a bullish impulse on the Dow Jones followed by a correction in the form of a triangular pattern. In theory, the price should break out to the upside with a target of 12,600 points (nearest bearish trend line) followed by the annual highs above that.

Due to the above we are of the opinion that at the moment this benchmark is not showing any signs of weakness. To the contrary, investors who got in further down and are now long can at least take comfort in the fact that first support does not come into play until far below, at 11,650 points.

JR

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