Look back over the past, with its changing empires that rose and fell, and you can foresee the future too.

— Marcus Aurelius


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Wednesday, October 17, 2012

Markets at crucial levels


bumping against resistance, 7440.7480 key levels.  A break above that opens way for much higher prices.
Pluses for the rally scenario
1. For the last 3.5 weeks the market has been consolidating the gains since breaking through key resistance at 7170, no real selling BUT the sentiment at these levels turned decidedly bearish, with many looking for a top.
2. The market is not overbought
3. Daily indicators in process of turning up

Possible that we rally and fail at 7500, that would make for a more bearish case, but we would need to see a break below key levels below 7170.

Likelihood is a rally to test 7500 and then a retrace; BUY the dip (If nimble enough trade the short side but beware of sustained move higher)

similar to DAX
First chart shows declining trend line resistance 2007, 2011, 2012 tops
second chart shows daily closer up.

on the weekly chart we may have completed a bull flag, in which case measured target is around 1.40 !

major market mover, may have bottomed at 623.  If not possible test lower at 600 or at the 200 dma currently 580

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