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Strategies & Market Trends : Aardvark Adventures -- Ignore unavailable to you. Want to Upgrade?

To: ~digs who wrote (708)	10/27/2004 5:31:07 AM
From: ~digs	Read Replies (1) \| Respond to of 7944

Dow revisted ... daily chart stockcharts.com[w,a]daclyiay[pc40!c200!f][vc60][iut!Ul14!Uk14]&pref=G (once again, context for lurkers... my belief is that the dow30, having been the most resilient index since the market peaked back in Y2K, holds the key to this country's overall economic path. In terms of relative performance, both the nasdaq and the s&p 500 are laggards when compared to the Dow during these past four years. Strength then, if you can call it that, has thus resided in the various Dow components. They have typically been the last companies to rollover. My conclusion: Dow leadership is critical; a failure for this index means big trouble elsewhere.) Now then, previous postings have already established the obvious presence of a downtrending channel. Depending on how thick you draw your trendlines, the lower channel boundary was probed early in the session on Monday. Fortunately for the longs, prices later rebounded, and the resulting candle was a display of market indecision. On Tuesday it became clear that the bears were temporarily out of gas. Buyerscame into the market and created the necessary foundation for a relief rally. I call it a relief rally because frankly, the volume does not support my calling it anything else. Certainly there was no indication of capitulation on Monday, and Tuesday's volume was hardly noteworthy. A bounce to the channel's median seems doable. Those moving averages overhead will be a challenge. It is the next wave down that I will be watching in earnest. If prices slice through 9800 again during a period of volume expansion, than the potential exists for downside momentum...