Out of Gas?
The DJIA went sideways today in a very narrow range. I am expecting a pull-back this week, and today’s action indicates that to be a likely event tomorrow. If that does happen, it could be another buy opportunity on the way to 29,500, provided we don’t fill the Gap and drop through 26,250. That would definitely be time for pause and reflection on the true strength that remains. In today’s market, news is important, including the lack thereof. If we see a 1,000 point drop for no apparent reason, we should take it seriously.
DJIA – 39 Minutes
The Daily Chart continues to show the Consolidation Target of 29,500. In this time frame, I could see a case for holding Long Positions all the way down to 24,800. That seems like a long way down but with the bullishness we have seen, a retracement to that zone would likely result in a renewed push upwards. Breaking that level would paint a different picture.
DJIA – Daily
I think the market is ready for a rest. But from all the evidence in the chart, I think it’s prudent to stay long and watch the support levels drawn in the 39 Minute Chart first, then the Daily Chart. With strong demand and a little help from the Fed, the market should continue pushing higher. And of course, it’s still an election year. We know that at some point, economics cannot be ignored; but the market seems quite content doing that – at least for now.