Bullish (but Caution is Advised)
Today was another anemic market day, with the Dow rallying just above the upper trend line we drew in the 39 minute chart. I hardly see this as a decisively bullish move. It is more the “inkling” of a bullish move. And that’s a problem.
The market has hesitated enough the last 3-4 days that I see a good case for a downside break and rally failure. In any case, the levels will tell us direction – for the short term anyway. Those levels are 26,600 up and 26,300 down. That’s just 300 points but a very decisive range based on the formation we are seeing.
The Daily Chart continues to show the side range we have been in for months now. Will we break through the high and continue to the top of the channel? I do not see that as likely at this point. But any upside movement from where we are (above the trend line drawn in the 39 minute chart at 26,600) should be considered bullish.
The Consolidation that is marked in the 39 Minute Chart is classically bullish where chart reading is concerned. But with the lackluster behavior – especially in today’s session after such an exquisite consolidation formed, we must watch for a downside failure through the lower line at 26,300.