Thursday the market moved sideways to down, forming a descending pennant pattern as shown in the 39m chart. This is a bullish indication that the next few days should continue to the upaide..
DJIA – 39 Minutes
The recent consolidation in the 39m Chart implies a move to 28,000 while the broad consolidation in the Daily Chart says we are going to 29,500. Continue to monitor short term support at 25,800, and long term at 24,800.
DJIA – Daily
I expect to see a pullback in the next few days, possibly after a strong push to 28,000. We need to watch the short term support level of 25,800. That is now key in this market, with 24,800 being the important downside level.
We have never seen anything like this in the history of the U.S. stock market, where participants completely disregard trillions in new federal debt, bankruptcies and depression-level unemployment. So we have to be ready for severe weakness entering the market.
In the end, it’s about supply and demand and strong demand from the rest of the world, plus the Fed, and continue to push the market higher. But at some point, economics cannot be ignored.