16 Nov DOW Intraday Analysis For 16th – 17th November 2011
This post is borne out of the fact that I was caught on the wrong side of the trade today whilst running day trades on the DOW. What works for me consistently, simply didn’t today and everything I tried in order to correct the situation made it worse!
So I’ve taken a closer look at the DOW and decided I’ll share my findings….even though there’s still no solid conclusion!
Daily chart is still showing identical characteristics of the May 2008 top. This is also reflected in other time frames in that, at the time of the 2008 top many believed from a fundamental and technical perspective that we would go higher and that is also the case at present. This analysis can be found in a previous post here.
Alternatively, this chart shows the similarities in one picture:
Hourly shows a possible H+S pattern within the “triangle” that everyone has been talking about. Most believe the triangle will break to the upside, however, you cannot believe that until it has happened.
Looking at the largest individual hourly candles, they are all red, and all red candles that lost 120 points or more had follow through.
What’s more, it is only those candles that produced the follow through that managed to crack below the 11,846 support level. All other attempts at 11,846 have found support.
This would suggest the probability going forward is that 11,846 will get broken and we’ll go lower.
4 hourly chart shows that the 11,846 support combines with a fib level. Odds are that this level will not hold.
Combining with this 11,846 area is a trend line that may offer support. Ultimately I think it will break simply because at current levels we are not finding buyers to break through the October high, so we may need to go lower to find them.
One thing I do find interesting is that the gap at 11,134 has found itself right on the 61.8% fib retrace of the current move. Although it’s no guarantee that we’ll go and visit this in a straight line from here, this is very similar to the early stages of analysis that gave me the 10,461 call back when the DOW was at 12,800.
All in all, I’ve really struggled to call the DOW right this Week, and today in particular has been tough for me, so bear that in mind when reading my analysis.