Dow Bounces off Support? DJIA Morning Update 12-11-2018
Is the 24,000 Level Safe for Now?
Housekeeping: Revision of Levels
Was doing some testing and revisions last night of the DJIA levels and realized that my original hand-written levels on printed spreadsheets were incorrect. However, the result of that is that the bottom of the long-term market starts at a higher level than previously stated and the top end comes at a higher level than previously expressed. The corrected 9 market levels are as follows:
- 12,288 - 14,336
- 14,336 - 16,384
- 16,384 - 18,432
- 18,432 - 20,480
- 20,480 - 22,258
- 22,258 - 24,576
- 24,576 - 26,624
- 26,624 - 28,672
- 28,672 - 30,720
These levels make a little more sense in terms of the price movement of the current market. The all-time high of the Dow was 26,951.81. This is within the 8th level. It is common for markets to struggle and take time to not only reach their 9th level, but also to exceed that level and move into the next expansion leg. This correction of our levels signifies the current market has never entered into the 9th level, and the times it fell below 24,576 it actually entered the 6th level.
DJIA Futures Fair Market points to a nearly 350 point bounce this morning which would move it back to within the 7th level. The correction of levels also means that the market is currently targeting 22,016. Only a monthly close above 27,392 would invalidate that.
Buy, Buy, Buy!
This is not a recommendation to buy. It is, however, a comment that - at least for the moment - it appears that the market may be tilting away from selling mode and towards buying. Market sentiment has been largely negative as reflected in news headlines and stock prices. After 3 days of declines, the market finally finished slightly positively yesterday, closing at 24,423.30.
Levels to Watch
Today watch the 24,576 should the market begin to slip from its strong opening. The 24,576 market represents the line between the 6th and 7th levels of this market after our revisions. Above that watch 24,832 to see whether or not that level presents resistance to the upside or not. If for some reason the market were to slip into negative territory below 24,576 - which doesn't seem likely, watch the 24,064 level which is also near the market's psychological support level of 24,000.
That Cat is Still Alive