Steady Continuation
Dow continues slow, steady advance, pushes to new highs yet again.
From prior commentary, "...the Dow traded between 11,565 and 11,605 throughout the day, which is the early framework for a possible continuation pattern...An upside push through 11,625 will indicate continued strength...” The Dow opened the session fairly quietly this morning, but eventually pushed through 11,605 en route to a steady advance to the Close, as seen in the 15 and 60 Minute Charts. The index closed the day with a 55 point gain and put in another six-year high while pulling closer to all time highs at 11,750. Look for the index to continue pushing higher as long as it continues to hold above major resistance at 11,425.
The 15 Minute Chart shows the Dow has gotten a solid 200 continuation after breaking through major resistance at 11,425 just five days ago. This break and rally truly shows the strength of the Dow at this point. Given that the Dow has rallied nearly 300 points in just a week of trading indicates that we will likely see the index either pull back from the current highs or form a continuation pattern.
Look for the index to remain strong in the medium term, especially if it continues to hold above 11,550. The formation of a consolidation above this zone will indicate continued upside movement toward all time highs at 11,750. Otherwise, a solid break back below 11,550 will indicate a larger retracement.
Short Term Dow
The Dow closed the day above intraday resistance at 11,630, seen in the 1 Minute Chart. Watch this level for early direction tomorrow morning.
Medium Term Dow
In the medium term, we are still Long the Dow from 11,515 and currently have 123 points in the trade. We will hold stops at 11,550 and will want to stay Long above 11,700. We will hold off on Shorts, unless 11,550; using 20 point stops.
NASDAQ & S&P
While the Dow pushed steadily higher, the NASDAQ and S&P each held firmly within the boundaries of clear consolidations. Look for continued range movement within these ranges until a solid breakout is seen.
Summary
The Dow ended the day with another steady advance and continues to push toward all time highs for the index. The index continues to pull away from the major 11,425 resistance level and will likely continue to exude strength as long as it remains above 11,550.
Thanks for listening, and Good luck in your trading!
Ed Downs
edowns@nirvsys.com
with assistance from..
Frank Ochoa, Sr. Market Analyst
fochoa@nirvsys.com
** Note: We are now posting Index entries and exits in Real Time, through our new Intraday Index Alerts service. To learn more about the service, visit SignalWatch.com and select Intraday Alerts from the main navigation bar. - SW Team
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