Monday, August 20, 2012

DJIA and Nasdaq 100

DJIA forecast for week starting 20 August 2012

The number of unemployment ticked up from 364k (revised from 361k) to 366k without big surprise. Housing starts dropped to 764k (consensus 757k), but building permits has risen to 812k – highest since August 2008 just before Lehman. Retail sales advanced for the first time in last 4 months for 0.8% in July.

Manufacturing remains weak spot of the US economy, Philly Fed Manufacturing Index is short of expectation showing contraction in manufacturing.

Technical Forecast

Weekly Chart: Bullish, slowed down. I remain DJIA target 13350 pts. Daily Chart: Bullish – momentum is reduced- day range is contracting from 107 pts. to 68 pts.
Intraday Chart: lack of momentum and lackluster market is capped below 13300 and more booster is required to push the index higher. 30 minutes chart is showing a reversal signal indicating market is due to a correction soon.
Current support 13250, next support 13150.
Still expecting market to go up gradually to 13350 pts.
Intraday trade: Long at initial shadow near current support 13250 TG 13350 / close EOD.

Nasdaq 100

Market has moved higher and higher each day for Nasdaq 100 an it has hit our target 2748/50 without much hesitation.
Weekly Chart: weekly candle shows bullishness and market shall continue up to test pincer top 2794 (April 2012 high).
Daily Chart: bullish, day range contracted from 24 pts. to 18 pts., I think this part shall be similar to Dow, and we expect market to trade slowly towards resistance 2795.

Intraday Chart: neutral.
Current support 2765 pts., strong support 2325.

Wishing Muslims Selamat Hari Raya!

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