Today’s Forecast: Scatter Dow, Partly Bearish
I was pretty surprised by how bearish yesterday’s market action was. Not by the gap fill (where the market opened much higher than yesterday’s close and reversed to the downside), but by the continued downward pressure. Watching gold, commodities, and other minor markets confirmed that I was probably a bit too bullish in my posture so I took a fresh look at the markets.
Here’s what I found:
We are sitting just below pretty strong overhead resistance at 8800. The volume is declining which is usually a weakening but that could also be due to the summertime. Weak MACD are turning down and ATR (or total distance from the high to low each day) is getting smaller. By themselves, it would be a toss up. Taken together, things are looking short term weaker.
My best guess is to look for a push away from 8800 to the downside with a reversal and eventual breakout on big news. One we breakout pay attention to the 9,000 level resistance. If we slice right through it without retracing we should be at 9,500 in short order.
I going to use this bearish move down to cash in my bearish trades and setup some neutral / bullish trades on the cheap.
Mojo
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Mojo