Dow did not manage to break the 11000 level on Tuesday’s trading session. The index has made a significant recovery since its low on March 2009 and it is not realistic to keep going up in a straight line. Looking at the monthly chart, the Dow has made 10 white candles out of 13 trading months from March 2009 to March 2010. Hence a pullback at this point is actually healthy for the market.
Judging from the phase chart, the market is still in bullish territory. However the market is already showing some fatigue as it runs into resistance level. If the index manage to overcome the 11,000 level it is most likely be coming against a strong resistance at 11,300 level. This level coincides with the 61.8% Fibonacci retracement level.
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