Here is a short report of my weekend homework. This was really down week on most markets. All my impulses are giving me reds right now. In active markets like this past week, I have a tendency to stay on the sidelines a bit and watch how it plays out. I know for a lot of day traders and scalpers, these are great markets to play in. But I know my trading style and the time I have committed in the game and it does not fair well in hyperactive market conditions. I leave these markets for the big boys. Here the weekly impulse table.
note: .DJI, .IXIC and .SPX are the Reuters symbols for Dow Jones Industrial Average, NASDAQ Composite and the Standard and Poors 500 Index respectively.
For me, things are a little too uncertain to get back in. First, I look at Dow weekly chart. The price quickly dropped back to mid to late December price level. On the weekly TSV I also noted the last similar drop on the TSV was around May or June or 2006. With the weekly levels chasing the lower Bollinger Band, I will need more input to see what direction things are taking and react accordingly.
The daily candle chart is as dramatic. We get seven consecutive red impulses and a general trend looking down. From the 12700-12800 levels we reached recently, market looks like it wants to re-test previous support levels. 12000 was tested early in November of 2006, a little over a week after breaking the 12k level. After a small grown, the 12100 level was tested near the end of November. How we fair around 12100 will decide whether the market will re-test 12000 or not.
Happy Trading!