Support Holds; Bullish Pattern Emerges
Yesterday, I indicated that “we are sitting right above a (key) support level.” Today, the market reacted to it, forming a nice saucer pattern with an upside push at the end. This is bullish going into Friday, and should follow through as shown in the 39 Minute Chart.
The Daily Chart continues to show the wide consolidation, with very large ups and downs recently – a sign of an uncertain market. Normally, this would be negative, but there is just enough positive news (new stimulus potential, for one) that the market continues to hold its bullish posture.
We are now within striking distance of the critical 24,750 support level. But until that line is broken, the range between 25,000 and 27,600 is still operable. It appears we are in an upward swing back into the range, based on the 39 Minute chart from Thursday.
But anything can happen in this market. One solid piece of bad news could push us through the 24,750 level and then much lower. All we can do is continue to play the swings intra-day but watch that critical level for a downside break.