In my last dow update, I was excited because price broke out of an upward wedge - a powerful trend continuation signal.
BUT...
We quickly lost momentum and fell back down into the wedge and lower. This is NOT a good sign. Bullish formations denied become bearish.
The market is scared of the action-packed week's data - specifically the FOMC decision tomorrow. I'm therefore cautious going into this week: if we fall sharply today and tomorrow on news that the market hasn't priced in, that will set a bearish tone for the beginning of February and MIGHT produce an high waterline for January. I will not call the top, but it could mark a multi-month pause or consolidation.
The 26k level will be key to hold and bounce from this week.
The 24.8k level will be key for this month. Watch were we close on Wednesday to judge the tone for the next month.
I am neutral for now.
BUT...
We quickly lost momentum and fell back down into the wedge and lower. This is NOT a good sign. Bullish formations denied become bearish.
The market is scared of the action-packed week's data - specifically the FOMC decision tomorrow. I'm therefore cautious going into this week: if we fall sharply today and tomorrow on news that the market hasn't priced in, that will set a bearish tone for the beginning of February and MIGHT produce an high waterline for January. I will not call the top, but it could mark a multi-month pause or consolidation.
The 26k level will be key to hold and bounce from this week.
The 24.8k level will be key for this month. Watch were we close on Wednesday to judge the tone for the next month.
I am neutral for now.