dow charts, page-9

Again, the fact that retail sales, which is considered a very reliable and important economic indicator rose 1.3%, thats .6% more than the street expected would have normally sent the DOW on a wild rally but it could only manage 65points to the upside HOWEVER as I have mentioned previously... """It would not surprise me if it breaks through this trend line as I don't think the resistance is that heavy however I do think that the ascending trend line from April 09 is very resistant and as mentioned in previous posts on this thread it has shown this by having approx 7 attempts at breaking through in the last 6 months only to fail on each occasion""". (post #12394).

Well it has now broken out from the descending (down trend) line from Oct07 highs as suggested this resistance is much weaker than the ascending trend line resistance which it still has to get through. I admit I didn't think that it would get through the first resistance by now but as suggested a few times in recent weeks if sideways action sticks around (which it did/has for about 1 month) then eventually that line will be broken. No doubt it was the reason for the sideways action imo. The question now is.... Will it hold it and will it make it up to the important ascending trend line from April this year?

You can see on the chart the price broke out on the weekly chart thanks to the green on Thurs/Friday, keep in mind this has happened in the past only to retreat in sessions to follow (false break out), considering those retail figures and last week’s better that expected employment figures I think it has a chance of hanging on and possibly head for the top line. I have calculated the line above (now the target) is at approx 10,731 points (on the weekly chart), which is 260 points from where it is now. On the monthly chart the target is all the way up to 11,226 which would see the price resting right on/underneath the trend line. Is this the medium term target??

One thing to remember and consider is that the closing price on Friday was not a new high and actually exactly the same close as Tues 1st Dec which was the high for the year. Double top?? Normally bearish sign! I still think 1080 on the SPX (S&P500) is where we will finish the year. I've mentioned before that the bollinger bands are the tightest they have been for a long time, well they are even tighter now and something substantial is about to happen imo. Let’s see what unfolds. Expiration week in the US this week should bring some decent volume to their market.

Interesting our market tested the current support trend line (see chart below) on Friday only to close higher. So far with today's session the price is sitting right on the trend line. The likely scenario is that it will make it up to the blue line overhead at approx 4,760. The slow stochastic at the bottom looks like it will also be caught by the trend line just underneath the current price. If the DJIA comes off tonight (depending on how much?) we may slip under the line tomorrow which would change the whole scenario and probably see us retreat to the next support line below. We may be pre-empting a bit of red on the DOW tonight and then have a flat day tomorrow to stay above the line? Again, an important night in the US tonight imo for immediate direction for XJO.

DAILY chart DJIA


WEEKLY chart DJIA


MONTHLY chart DJIA


Daily XJO chart (10 months)


Daily XJO chart (3 months)