More TA from Fib Master to help w/ Roadmap for
Next Week:
DOW: High Probability of move back to 9800 next week,
or even 9900, where will be met with heavy R.
SPX: Rebound to 1050...a move to 1070 unlikely but
not impossible.
NAZ: Rebound to 1550 or 1600 where will be met with heavy R.
(A High Probability of a move to 1247 at some point, after this Technical Bounce.)
The Dow Jones Industrial Average (INDU) Closed at 9590: A few nights ago I discussed the technical patterns that had formed on the Dow, and discussed implications of these. Although the Dow enjoyed a rather impressive rebound today after hitting a low of 9472, today's action did little to improve its overall technical picture. Short-term, yes, a rebound is likely since the Dow came down to its 161.8% Fibonacci retracement (of its April 29th - May 17th advance). There is a high probability the Dow can continue to rebound off this region next week, probably returning to the 9800 resistance region. There is an outside chance that 9900 could be approached. But the bottom line, at this point, is this: technically, the Dow began a serious breakdown out of a longer term triangular consolidation this week and any rebound to 9800 - 9900 is likely to be short-lived. The Dow MUST return--immediately--to a level within the boundaries of the triangular consolidation (that is, decisively above 9900) if it is to offer any hope of repairing this week's technical deterioration.
Let me mention just one other point. Although today's low (9472) SEEMS to be have been a good short term rebound point, a decisive move below it next week will have the Dow looking at 9200--at best--and the clear prospect of 8800 in subsequent weeks.
S&P 500 (SPX) Closed at 1026: Like the Dow, the SPX declined to its 161.8% retracement today, indicating that today's about-face may give rise to further upward action next week. My forecast is for a rebound to 1050 before more weakness sets in; a move to 1070 would be unlikely but not impossible. If the SPX begins to decisively crack today's low of 1012, then things could turn fairly unpleasant, much as discussed above for the Dow.
Nasdaq Composite (COMPX) Closed at 1535: I said earlier this week that if the Nasdaq broke below its 1563 support region, it would likely continue on to much lower levels, the first of which is 1247. We closed well under 1563 today; while I am not ready to say that the COMPX is headed straight to 1247, that possibility now remains quite high as far as I am concerned. Over the next few days we should expect the COMPX to attempt to build on today's reversal, rebounding to either the 1550 or 1600 resistance levels before more weakness hits the index.
Siegfried Brian Barger,
Editor, Premier Investor |
