In my last post of US stock market trends on May 12, 2008. I noted that the market was at a junction of either going up or down depending on whether it breaks the resistance or support. The market seemed to be able to absorb the bad news and continue to head higher last week. And it is interesting to see a another higher low formed, this is an important indicator of a up trending market.
Let’s take a close look at both Dow Jones & S&P500, they are still sitting nicely above 20d MA and it is also interesting to note that it is testing the 200d MA resistance now. Success to break 200d MA increase the probability of further upside.
It is foreseeable that market will correct at the 200d MA. So, the market is turning south at the moment while I am writing this post. I view it as a healthy correction as the bull and bear are in a tug of war now. As long as the retracement does not break the previous low (DJ Index at 12,715). The up trending market is still intact.
Keep a look out for the market action this week!
DISCLAIMER: This information does not constitute an offer or solicitation to buy or sell. You should do your own analysis on top of my postings.
