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Friday, June 07, 2002
Thursday, June 06, 2002
SignalWatch: Market Direction - DOW Medium Term Dow Since the Dow broke 9,750 before the first 30 Minutes of the market were up, we entered Short at 9,725, upon the crossing of the lowest low made during the the first 30 Minutes of trading. We are still Short from this level, and will hold our stops at 9,700 for tomorrow. We will add to Shorts below 9,600 Still short! Wednesday, June 05, 2002
Tuesday, June 04, 2002
SignalWatch: Market Direction - DOW Target Reached Dow reaches 9,600 target, forms trading range at the low. Watch 9,600 down, and 9,750 up. Monday, June 03, 2002
Still Short Below 9,800 From yesterday's commentary, "...If the index can form a higher low above 9,900 Monday, we will likely see an upside continuation. This is the most likely scenario for Monday. However, if the Dow trades below 9,875, all bets are off and we will likely see a downside move. A break of support at 9,800 will be the "big confirmer" for a failure..." As we teach here on SignalWatch, consolidations are continuation patterns and usually break in the direction of the current trend. We did get the downside break implied in the intraday pattern. however, the target has not yet been reached. We can use the formation of the pattern to determine where the ultimate low might lie, as follows: In the 15 Minute Chart, you see that the intraday consolidation formed around the 9,825 level. If you take this level and subtract it from the previous high of 10,050, you get a difference of 225 point. Now, projecting the 225 points down from 9,825, you get a target of 9,600 - our likely low for this move. Short Term Dow Short term, the Dow ended the day just above 9,700. This will be the key level to watch for tomorrow's Open. Use it as a fulcrum (!), trading Long above, and Short below. Medium Term Dow In the medium term, we entered Long this morning at 9,950 after the 30 minte point, but closed the position at 9,925 on the downside reversal, for a 25 point loss. We later entered Short at our published 9,875 level and are still Short from there, with a current paper profit of about 175 points. This illustrates what we are after on SignalWatch - we want to be "in" at the key fulcrum levels, and about every fifth trading day, we will see a move like this. We will move our stops down to 9,800 for tomorrow's trading. We will also go Long above 9,800, with a 25 point stop in that direction if this occurs. NASDAQ & OEX (SP 100) Both the NASDAQ and OEX dropped in the morning, consolidated at midday, then dropped in the afternoon, leading to a some of the lowest levels of the year. For tomorrow, watch for the consolidation targets to be fulfilled. * Summary The Dow broke below 9,875 this morning and continued significantly lower, especially after the intraday consolidation that formed. The consolidation projected a downside target of 9,600. Watch for this tomorrow. We are now Short from 9,875, and will hold stops at 9,800 for tomorrow, entering Long there if that level is crossed. Thanks for listening, and Good luck in your trading.. Ed Downs with assistance from..
Busy weekend For got to post this: We are now on the sidelines and will watch 9,950 up, and 9,875 down for Monday, with 25 point stops in either case. |