It certainly looks that after the dip people are placing there bets and showing some support, although we need to watch the closing of the day and end of the week. Below is what we are watching and some data so you can feel confident in your holdings.
With the crash in the US Markets, capital is flying into Gold due to uncertainty(which is still bearish long term) and some INTL currencies(which the USD is going to destroy as it keeps rising with interest rates and INTL debt and uncertainty, Remember Turkey currency crash in August, that was our first signal of INTL debt crisis). So this is just like a herd of animals all running in all directions due to sharp move. Lets see where capital goes once the dust settles.
Looking at the DOW you can see basically opened yesterday in the uptrend channel we are in now. This gives us some reasoning why we are testing the channel now. But what’s interesting is we are holding our previous breakline, which is telling us nothing to fear right now. Remember, daily and weekly stuff is just noise. It’s really the monthly and up that sets the trend. As of now, the important support is 25,889 and this has not been broken or closed below on a monthly basis.
What to Watch Today For A Bounce:
- Close above 2557.07, it’s possible for temp low
- Close above 25889, it’s more likely to bounce into Monday
Today, 10/11 is a daily direction change, so if we close lower its down for a day, if above our low yesterday it’s back up. Of course, this is short term trends. We still are bullish long term due to important support not broken on a monthly closing which is 25889, and changes after each months closing usually based on close.