Tuesday, March 27, 2012

Dow - A liquidity driven market


Dow gained 233 points on Monday with a solid candlestick. Since the closing price stayed below 13,331 level, the Option 1 scenario as shown above remains valid.


However, in the next few days, if Dow instead of breaking the lower trend line, it moves higher and breaks the previous high of 13,331 and proceeds to break the 13,500 level, then Dow is more likely to go for the Option 2 scenario of forming a big 'Double top' reversal pattern by the end of 2012, supported by liquidity all the way to 14,164 level.




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