With the Dow at 16,000, is a 1300 pt trading range that ridiculous? I don’t think so. That’s plus or minus 8%. 4% up, 4% Down.
Looking at the chart below, since 11/7/13, roughly the last 5 months, we’ve been between 15,500 and 16,500. Call it really a solid 1,000 pts.
Granted in February, we dove below 15,500, which got the bears on the warpath. I distinctly remember people calling for Dow 14,800. Which would have been the much anticipated holy grail of the “10% correction”. Super bears were touting a break of 3200 pts, taking us down to 13,300?
One thing is for sure, YMM is trading sideways, basing for a break out above 16500 or below 16000.
That probably explains why the bears got so over excited when we traded below 16000 on Monday.
16,500 has been the wall of resistance since New Years Eve in the Dow Futures Contract. That’a a fact.
There are two trend lines down below that the bears are looking at: The first comes in with support at 15600. The second, longer term t-line comes in with support at 15,000.
Food for thought if you are looking for a down flush.
Finally, this chart shows how Monday’s low was almost a perfect 1/2 way back move between the February 6-month low and the record high posted just 2 weeks ago, after the last Unemployment number.
15892 was the 50% retracement of the move.. Today’s high was 16329. That was 437 points ago, but something that will never get attention from the doom and gloom crowd. The only problem is, if you sold it there and didn’t get stopped out, you lit $4370 on fire.
CER
