The following chart is technical analysis for the Dow Jones Industrial Average ( DJIA ) for 11/17/08. What will the Dow Jones do on November 17th. 2008? We had a big technical sell off at the end of the day, basically as you can see on the chart, we tested the 10 day moving average and it was rejected. Technical Traders rule the stock market right now as almost no stocks are trading on fundamentals. You are seeing these huge moves because support and resistance levels are being hit. It is important to recognize them so you don't make a horrible trade. The 10 day moving average right now is probably more important then any other time, the buyers and sellers are fighting a war around this line. We need to close above the 10 day moving average and stay above it, this will get people bullish.
Dow Jones Technical Analysis 11/17/08
The Dow Jones has made a double bottom under 8000 but is still in a downtrend. Under 8000 looks to be a great place to buy after unloading in the 9000's. Until we close above 9800....this is your trading range. Notice how we stopped at 9653.95 after closing above the 10 day moving average for six straight days and then crashed back under two days later....this is bearish. The 10 day couldn't even hold! We have now tried to close back over the 10 day moving average twice ( Nov 10th, Nov 14th ) and it was rejected. You can't even think about getting bullish until we close back over the 10 day moving average for a few days. The Dow Jones closing low is 8175 and if we close below this at any point, it could get ugly.
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