Do We Have More Upside in the Bounce?

By: J.D. Rosendahl | Thu, Feb 25, 2010
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On February 5th, the markets put in a Dragonfly Doji, a one day bullish candlestick indicating the markets were looking to bounce.

Friday the 12th, the markets put in another bullish one day candlestick, a Hammer. This hinted to more upside and that's what we got the following week.

Here we are 2 weeks later and the markets have put in another Hammer candlestick.

Today's Hammer would indicate further upside in the bounce started on February 5th. If so, the next resistance level is about 10,500 on the DOW. That's where we have a confluence of resistance (The daily upper Bollinger Band, rising trend line off minor peaks, and prior lateral peaks).

If the market is going to continue the "Big Correction" like many Elliot Wave analysts have labeled, the markets should roll over soon, now or maybe after testing 10,500 and then failing.



Author: J.D. Rosendahl

J.D. Rosendahl

J.D. Rosendahl is not a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. Of course, we recommend that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and barring that, we encourage you confirm the facts on your own before making important investment commitments.

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