Round Trip
Dow rallies, but breaks consolidation to downside to finsih round trip session.
From prior commentary, "...The index continues to trade within the wide trading range that has formed in the Daily Chart...look for continued range movement and volatility within the wide trading range..." The Dow got a sharp rally out of the range formed during yesterday's trading, as the index gained 160 points in the opening two hours of the day. The Dow proceeded to consolidate at the highs before finally getting a downside break late in the session, as seen in the 15 Minute Chart. The downside break led to a steep decline, which pushed the index back to near-breakeven territory for the day.
As has typically been the case as of late, the index continues to trade in volatile fashion within the wide trading range that has formed at the highs of the Daily Chart. The Dow continues to generally trend higher above the major lower trend line that has formed beneath the lows since March. Look for further range movement within the boundaries of 9,150 and 9,360, also seen in the 60 Minute Chart.
Trading within the range is just too volatile for medium term positions at this time, but catching intraday swings within the range can be lucrutive.
Short Term Dow
The Dow has formed a tight range from 9,225 to 9,255, seen in the 1 Minute Chart. Watch this range for a break to indicate direction tomorrow morning.
Medium Term Dow
In the medium term, we entered the market Long this morning at 8,315, but the round trip nature of the market took us out of the position at the entry for another breakeven trade. Again, we will widen out entries for tomorrow's market, as further volatility within the range will likely continue. Watch 9,150 down, and 9,360 up, with 10 point stops.
NASDAQ & S&P
The NASDAQ and S&P each powered higher this morning alongside the Dow, but both failed by the end of the session. The NASDAQ continues to trade within the wide channel boundaries, while the S&P continues sideways within its wide consolidation boundaries. *
Summary
The Dow rallied out of the gate this morning, but a downside break from an intraday consolidation sent the index back down toward the Open. The index continues to oscillate within the range boundaries, which will likely continue until a solid break from the range occurs. Watch 9,150 down, and 9,360 up tomorrow.
Thanks for listening, and Good luck in your trading..
Ed Downs
edowns@nirvsys.com
with assistance from..
Frank Ochoa, 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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