So we clearly broke 23,800 today. And that’s good. The way to bet now is “Long above 23,800. Out of the market from 23,000 to 23,800. And Short below 23,000. I don’t see any other way to play it. There is still a lot of fear in the market. But as long as it can hold 23,800 it’s up, up and away!
DJIA – 15 Minutes
The Daily Chart continues to show a solid consolidation with clear support and resistance boundaries. The wide consolidation implies a move up to 29,000 – but that would be in a normal market. This is anything but normal. But now that we’ve seen a solid break of 24,800 – the market should follow through.
DJIA – Daily
Commentary: So here we are. Breaking resistance. But we also see belwether stocks, namely AAPL and NFLX hesitating. Is the leadership faltering? I know the 23,800 level is significant and make no mistake about it. Even with the economic debacle that has unfolded, the market CAN rally higher with a little help from the Fed. We have to go with it, unless the market drops back in the channel.
So the market wanted to go up – and it did. But I firmly believe this market is going to come to terms with reality at some point. In the interim, there can be huge profits trading in the direction of strength. Whether that strength is due to actual bullishness or because the Fed is buying the market, we can’t know. If it IS the Fed, there is a point where stimulus runs out.