Stock markets are going back up testing their recent highs, just as we indicated last week.
Some markets have gone into new 52 week highs already.
We have a few more Green periods days to come, so this week will probably be OK.
But from next week onwards I expect some more muddled waters, when we go in the Red Period again.
As this rally ages we have to become prepared for a correction that will take longer than a week.
So we have to keep our eye on the charts, and when the longer up trend breaks down, then I have to be ready to exit the market, especially when a Red Period is just starting.
Here is the current situation for the Nasdaq index (click for full size image):
Upside potential is probably limited by the overhead trendline that has been in play all year long. So if we reach 2650 this week, that will be a very good selling price.
First support is on the trendline for the rally that started last August, near 2550 for this week.
A larger correction would probably take us down to 2300 – 2400, where I would also expect major support to come in.
So I am ready to sell near 2650, or on a break below 2520 this week.
Good luck, Danny
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This entry was posted on December 6, 2010 at 9:52 am and is filed under Market Commentary.
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LunaticTrader
Outlook December 6
Posted by Danny on December 6, 2010
Stock markets are going back up testing their recent highs, just as we indicated last week.
Some markets have gone into new 52 week highs already.
We have a few more Green periods days to come, so this week will probably be OK.
But from next week onwards I expect some more muddled waters, when we go in the Red Period again.
As this rally ages we have to become prepared for a correction that will take longer than a week.
So we have to keep our eye on the charts, and when the longer up trend breaks down, then I have to be ready to exit the market, especially when a Red Period is just starting.
Here is the current situation for the Nasdaq index (click for full size image):
Upside potential is probably limited by the overhead trendline that has been in play all year long. So if we reach 2650 this week, that will be a very good selling price.
First support is on the trendline for the rally that started last August, near 2550 for this week.
A larger correction would probably take us down to 2300 – 2400, where I would also expect major support to come in.
So I am ready to sell near 2650, or on a break below 2520 this week.
Good luck, Danny
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This entry was posted on December 6, 2010 at 9:52 am and is filed under Market Commentary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.