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Monday, January 23, 2012

Dow Jones Industrial Jan. 23, 2012 EOD Must Read

How Long will the Rally Last?
 We started the day out in the black with the Dow Jones Index rising but then meeting resistance around the 12,760 area. I have been writing this blog specifically to spread the message of the Why Choose the Wave Principle?, and the Wave Principle states that a downward forceful wave is very likely in the coming days/week(s).

Pending correct wave counts, it appears as if we are in the last 5th wave up, however it may be extended. In the prior post, I stated that a great target would be the top of the trend line indicated by the gray circle on the chart. Just as possible is a break above the trend line known as a throw over. Regardless, at this time the analysis still says DOWN is coming. Reference Elliott Wave International for more background information and expert forecasting.

Worth noting are the trend lines that I have drawn more than a week ago. They are holding true as true can be with trend lines. This is partly why I like to focus more on the Dow Jones Industrial Average; it tends to abide by technical analysis rules the most often, in my opinion. Take a quick read with How to Identify and Use Support and Resistance Levels.

There is a small chance that we have found a top, but I still see hitting the top of the trend channel  more probable. The 12,900 area is a good round-about target area for the Dow. If you have long term money sitting in the stock market, I would highly recommend getting a 2nd opinion with the Elliott Wave Principle.

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