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The Trading Range Continues
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The earnings season continues to bring in more bad news as each company shows signs of being hit by the credit crisis. Most recently GM has been under increasing fire and as I write this post, she is trading under $3.25 a share. The only positive note in all of this is the lowering gas prices as a result of the downturn in the economy.
The trading range we are experiencing in the Dow Jones is simply unbearable. This up and down action has been going on for over a month now and it appears that it will continue to do so for the foreseeable future. The October 10th low on the Dow is still holding up, but the lackluster action near the 9,800 level implies the market could attempt to retest the recent lows.
The market is continuing to pullback from last week's high set on Wednesday, with fibonacci support coming in around the 8,600 - 8,500 level.
If this fibonacci level does not hold, we are in for a retest of the lows in the 8,200 - 7,800 zone.
With so much noise and wild swings in the market, let's get old school and take a look at the point and figure chart of the Dow Jones. This is always a favorite of mine when market volatility gets too extreme. Notice how the Dow is coming into major support at the 8,600 - 8,550 level. Look for some fireworks to take place in this key zone. If the bulls are able to hold this level, it should setup the next up wave; however, if she is unable to hold here, the bears will have their way.
The trading range we are experiencing in the Dow Jones is simply unbearable. This up and down action has been going on for over a month now and it appears that it will continue to do so for the foreseeable future. The October 10th low on the Dow is still holding up, but the lackluster action near the 9,800 level implies the market could attempt to retest the recent lows.
Dow Trading Range
The market is continuing to pullback from last week's high set on Wednesday, with fibonacci support coming in around the 8,600 - 8,500 level.
If this fibonacci level does not hold, we are in for a retest of the lows in the 8,200 - 7,800 zone.
With so much noise and wild swings in the market, let's get old school and take a look at the point and figure chart of the Dow Jones. This is always a favorite of mine when market volatility gets too extreme. Notice how the Dow is coming into major support at the 8,600 - 8,550 level. Look for some fireworks to take place in this key zone. If the bulls are able to hold this level, it should setup the next up wave; however, if she is unable to hold here, the bears will have their way.
