Market Waves Caution Flags, Tests Support
Posted by Blain Reinkensmeyer
November 27, 2006 at 11:01 am
Be careful today, the market is selling off fairly nicely thus far, and has showed no signs of bottoming out. Real time the NASDAQ is off some 30 points, the Dow down 95, and the S&P500 down just over 9. The biggest loser so far is the NASDAQ, down just over 1.2%.
What you really need to watch is how the market reacts to key support levels, AND where volume ends up on the day. 2430 is the support line the NASDAQ is testing right now. A distribution day close under this level would be bearish. On the S&P500, look for 1390 to be the main support line. Both indices are trading right at this support lines real time, and as of 11 AM are holding up.
In the case of a fall and close under these support levels, it is not a bad idea to tighten stop losses and take some profits off the table. Profits are not profits until you have the cash sitting in your account. We will see how today plays out!
Happy Hunting.
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