- Dow Jones hits an important trend line in daily chart.
- Look how the trend line combines with the 200 DMA to give a double resistance.
- But the index is trading above both these points as of now.
- Closing above the trend line and the 200 DMA will make the bulls stronger and it is necessary for continuation of this rally.
July 13, 2010
- Dow Jones is trading above 50 DMA and 50 week moving average right now.
- The recent bull rally was resisted by the 50 DMA. But this time that did not happen.
- The only major hurdle before Dow Jones moving to 10600 is the 200 DMA. Will it be the 200 DMA that stops this rally?. We will know the answer soon.
- DOW WITH FUTURES NEGATIVE DIVERGENCE
- Dow Jones futures has been showing negative divergence for quite sometime.
- But the price confirmation is not happening.
- So even if there is negative divergence untill the hour chart makes a lower high this market remains buy on dips.
- Finding resistance near recent high price level. Should close above it to show the complete strength of bulls.
- Nifty spot hour chart trading near yesterday's high
- Closing above yesterday's high on hourly basis will show the strength of the bulls.
HALF HOUR CHART
- The price was not allowed to go above the 50 week moving average today.
- And another resistance in daily chart are the fib retrace level of 61.8% and if it crosses that the 50 day moving average is there.
- A Triangle is developing in the in the 30 minutes time frame. One has to be careful because of these resistances the upside break out may end up as a false one. Keep appropriate stop loss for the long trades
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