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Mix-Ansicht- Einschätzung von Ed Downs für heute zum DOW - Bill, 05.03.2001, 14:32
- ...und zum Nas. Comp. - Bill, 05.03.2001, 14:34
Einschätzung von Ed Downs für heute zum DOW
Roller Coaster
Dow drops at the Open, rallies and pulls back. Good sign of a higher low if we get follow-through at Monday's Open.
From yesterday's commentary,"...I would be leary of buying at the Open on Friday, since we came a Long way at the Close today (and you might get caught in a head fake - a rally that fizzles back into the gap formed by the Open). If we do drop, I would look at going Long at the reversal..."
As I feared, the market was teasing us Thursday afternoon. Right at the Open, we gapped down hard, and actually continued all the way to support at 10,300 before turning around. Then, like clockwork, the index turned and headed up the rest of the day, with the exception of a retracement back to 10,350.
The thing we all want to know is,"Are we there?" At the bottom, that is. I wish it were clear-cut this evening. Basically, we have the makings of a recovery rally, but the fact that the end of the day pushed down and consolidated at the low (5 Minute Chart) says we have more to drop before the next reversal.
Fortunately, the technical pattern left at the end of the day gives us a good set of boundaries, one at 10,500 (up) and the other at 10,450 (down). Odds are, 10,450 will be broken for a move back to 10,350. From there, I am hopeful that we get a true, strong higher low from which to trade. It's still"dicey" in here.
Short Term Dow
In the short term, the markets gave us a topsy-turvy day, without much net movement but considerable swings; a 250 point range day. There is clear rally pressure - the Dow wants to go up, but is stalling under 10,600. For Monday, watch the upper boundary at 10,500 and the lower at 10,450. Either way is good, and the market should move 50-75 points regardless. Personally, I think we have a good shot at an upside move, simply because the end of the day was at 38% of the range. But, you have to see how the Open fares and just go with that.
Medium Term Dow
Yesterday, I suggested holding off from getting in, since (a) there would likely be a retracement today, and (b) it is risky going Long before a definitive bottom formation, since we are just above support at 10,300. Monday is tough, because we the market retraced 38% but shows a basic head and shoulders pattern in the 60 Minute Chart. I really think you should wait for 10,600 to be crossed. That would give the bulls plenty to get on board with. Between 10,300 and 10,575 we are consolidating, and could easily drop through the bottom. Of course, if we do cross 10,300 to the downside, you have to get short quickly.
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