A Technical Look at Possible Market Resistance
Three stock charts for tonight to feast your eyes on and make your own assessments.
First chart, the Dow Jones Industrials, weekly view, 2 years 1 month, focus is on Fibonacci retracements, specifically the 50% level.
Click to EnlargeSecond chart, the Dow Jones, daily view, 8 months, focus is on a rising wedge that has been developing but may not prove to be enough to slow down the market.
Click to EnlargeLast chart, Apple, daily view, 9 months, focus is on today’s heavy accumulation break through the upper resistance of the rising wedge. Alongside the general market having a nice session today Apple was mentioned on Jim Cramer’s Mad Money last night further adding bullish sentiment.
Click to EnlargePersonally I am in the department of thinking this rally is going to be the second worst bear market suckers rally behind the 50% rally observed during the great depression. Heck, it could end up being the worst, but time will have to tell the story. Just be ready for downside pressure to kick up at any time.
Brian, I thought the same thing in mid August since all the technicals pointed to negative divergence. See chart: http://chart.ly/cv7gm9
But now, I don’t see very much on the technical side other than being over extended above MAs. And as we all know, we can stay “over-extended” for a very, very long time. The good news is that volume is picking up, so moves no longer seem so ghostly.
You’re advice is sound, we all need to keep our long stops at appropriate levels.
AAPL has defied gravity so many times, but the 190~195 level, and the all time high, may just be too tempting for sellers, effectively killing the rally. Chart: http://chart.ly/zsg6ke
Fantastic stuff, thanks Ed!