Tuesday, 24 July 2012

US indices moving sideways above support levels

The more time passes the more the move from June lows looks corrective to me. I don't think that the market is gathering power for a move higher, but rather is still correcting the downward move of April-May. Both S&P and DJIA as depicted in the charts found support at the upward sloping trendline that connects recent bottoms. As long as the market remains inside the trading range created in June, we are going nowhere. As I said at the beginning, the market from June lows has an overlapping pattern that decreases any bullish chances for an impulsive move upwards. The most possible outcome for me would be to see the market break down around early August towards lower lows than June 1st.

S&P support is found at 1337-1325-1310. If support is broken then target would be towards 1200-1150

DJIA support levels are 12500-12450-12380. If broken then the market could move towards 12000 and lower.

Thank you for taking the time to read my posts.

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