This the monthly chart of DOW, gloom and doom, this looks overdone, and I guess we need a reprieve now in form a nice rally. As you can see the RSI (on the top) is at levels not witnessed earlier. And speaking of the MACD, this has been a sharp and deep cut below, it will take a lot of time to turn shallow and then up(Warren Buffet just commented that 2009 and maybe a lil longer is going to be tough) so no hurry there!
In my last post also I have been saying that we need to get positive divergence on the weeklies to have a meaningful up move of any reckoning. As you can see the weekly chart below, we seem to be on the way of getting one. By the way we are stretched out too far far away from the falling MA’s that its time for reversion to the mean. This will be either in form of a nice sideways consolidation move, to let the MA’s come down and then maybe take a dig at them when they are strikeable distance (the 20 in green in this case!).
Finally the daily chart below, I have made some kind of channels, for that dramatic effect, and to add a lil bit of theatrics I have even put alphabets and numbers (makes me at least look intelligent eh!). A nice bounce back is in order, perhaps till 7450/7500, and the road ahead can be gauged on how we react there.
And the last chart; the BDI and SNP, is just for filling in the blog space and it also shows what a hard work is gone into this post...phew!!!
"It is wise to keep in mind that neither success nor failure is ever final." Roger Babson
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