Left hand the weekly Dow and as you can see the bias is to the downside still heading for the 61.8% retracement level at 9900/10000 which is also an good support for this year. The process of getting the bottom will take another 4-5 volatile weeks with a small rally due at the end of this week with the bailout package finally approved. Astrologically the days 2nd - 5th Oct. are very promising. Thereafter we will fall back into selling pressure with Hedge funds liquidating and the ban short selling of financials being ended. The other point confirming an extension and a severe low comes from the VIX - the only other time it closed on a weekly and monthly basis over 40 we had a consecutive month of those levels and a low in the month thereafter was Sep. 2002. Although this low will not have the same significance but still I expect a repetition of the situation and a retest of the low in the first quarter nexz year for other cyclical reasons.
Tuesday, September 30, 2008
Technical outlook for the DOW
Left hand the weekly Dow and as you can see the bias is to the downside still heading for the 61.8% retracement level at 9900/10000 which is also an good support for this year. The process of getting the bottom will take another 4-5 volatile weeks with a small rally due at the end of this week with the bailout package finally approved. Astrologically the days 2nd - 5th Oct. are very promising. Thereafter we will fall back into selling pressure with Hedge funds liquidating and the ban short selling of financials being ended. The other point confirming an extension and a severe low comes from the VIX - the only other time it closed on a weekly and monthly basis over 40 we had a consecutive month of those levels and a low in the month thereafter was Sep. 2002. Although this low will not have the same significance but still I expect a repetition of the situation and a retest of the low in the first quarter nexz year for other cyclical reasons.
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