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To: Softechie who wrote (3959)	12/12/2002 1:37:34 PM
From: Softechie	Respond to of 29596

CHARTING MONEY: Stock Downtrend To Be Continued 12 Dec 12:09 By Stephen Cox, CMT A Dow Jones Newswires Column NEW YORK (Dow Jones)--The stock market has been going sideways for the past three sessions, and Thursday morning's action so far squares with consolidation. In this kind of market, it's reasonable to expect that the next trend will be in the direction of the trend that preceded the consolidation. "Continuation," that's called. In this case, the trend is down. So, moreover, is the general trend of the markets since early 2000. The prospect of higher-priced Treasurys and a steady-to-lower dollar certainly squares with a renewed fall of the stock market. The Dow Jones Industrial Average is toying with the 8580.82 - 8574.83 daily chart band. Falling momentum and moving average support suggest that 8574.83 will be taken out by a move to support between 7835.92 and 7579.70, perhaps by early next year. The Nasdaq Composite is technically weak below 1419.11, and new lows for the move are likely. Supports at 1364.11 and at 1335.09 are bounce points, and the Nasdaq could easily rally about 45 points when those levels are hit. But the index is on its way down to 1278.35 by the end of this year. A Nasdaq move below 1364.11 will complete a bearish pennant formation on the daily chart and signal a renewed selloff. Thus the frequent reference to the pennant, and other formations, as "continuation patterns." Treasury Futures Pointed Higher The CBOT leading March 10-year T-note is likely to take out 113-16 resistance with a move up to 114-21. The test of 113-16 could happen at any time now. The test of 114-21 is likely to happen on Dec. 16, I estimate. A decisive settlement above 114-21 at the end of this month would be the first step toward a long-term upside breakout. The breakout wouldn't be confirmed this month until 116-13 resistance is taken out. That resistance could be tested by the end of next week at earliest. This projection, of course, would be blown away by a selloff below 112-04. A failed test of 113-16 would strongly suggest that development. Euro Homing In On Breakout Resistance The euro rose against the dollar Thursday morning to $1.0163. So far, the high for the long-term bull market, $1.0170 - and nearly coincident target resistance at $1.0176 - are intact. But the euro's technical momentum is rising, and resistance is vulnerable. If it's taken out, a move up to $1.0262 is probable. If that happens, the chance for a move into the $1.0400 handle is likewise probable. Against the yen, the dollar found support Thursday morning just above important Y122.41 support. The chance for a continued rally, to Y124.65, is very likely now. It's also more and more probable that Y124.65 will be a prominent top. To try out the Charting Markets weekly technical newsletter go to djnewswires.com For more technical analysis see: Dow Jones Newswires, N/DJTA; Telerate, page 4073; Bloomberg, NI DJTA; and Reuters key word search "Charting Markets." -By Stephen Cox; 201-938-2064; stephen.cox@dowjones.com (Stephen Cox, a chartered market technician, is chief technician for Dow Jones Newswires.) (Data by CSI, Commodity Research Bureau) (END) Dow Jones Newswires 12-12-02 1209ET