Sunday, July 17, 2011

DJIA and Nasdaq 100

US Economic data releases http://www.forexfactory.com/calendar.php?c=2&week=1310256000&do=displayweek&month=7&year=2011


In short...
Worse than Expected: Trade Balance
Worse than Expected: Core Retail Sales m/m
Worse than Expected: PPI
Worse than Expected: Prelim UoM Consumer Sentiment

Match Expectation: Nil

Better than Expected: Retail Sales m/m
Better than Expected: Unemployment Claims
Better than Expected: Core CPI m/m

Summary:
Mixed Data... DJIA has been trading down to our weekly support 12450. Lowest 12410, Closed at 12483.


Like what we forecasted last week, DJIA can either go up to 12780 resistances, or find support at 12450.

From technical chart, DJIA has posted a weak Japanese candlestick pattern on Weekly Chart. This Indicate a possible downturn to 12320 1st support, if the policy maker stop printing money or the like.

For those who trade with patterns, zoom out to Weekly Chart and we can see a Head and Shoulder Pattern (slanted up), with the right shoulder formed and confirmed within these 2 weeks.

Those who missed the short call last week, don’t despair, don’t short immediately.
For those who are sharp, you will observe that DJIA is supported at EMA50 (4 Hour chart), therefore, I foresee DJIA to continue trading up on Monday.

Weekly Short action: Short when market traded up to 12570 – 12620 region.

Monday sell action 12570 SL 40 index points, close EOD.
Don’t buy immediately either :)
Monday buy action 12398 SL 40 index points, close EOD.

I like DJIA to melt… :ops: if DJIA can break below 12320, it is only the beginning.  If what we assumed is right, DJIA will be trading down to 12250, and 12000, soon.


Nasdaq 100

Difference: Nasdaq 100 do not have Head and Shoulder pattern :)

4 Hour EMA50 support has shown some bull, it is possible to continue the bullish sentiment from current 2357 to 2370.

Nasdaq 100 Resistance at 2375-2380 region.
Major Support for the week: 2300.

From the technical chart, my preference is to trade DJIA rather than Nasdaq 100, therefore, suggest to stay out from Nasdaq 100, if still want to trade, only trade when Nasdaq approach major support / resistance for the week.

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