I am not a financial adviser so you should not take any part of this blog as being financial advice. Observing and interpreting charts is a hobby and so is this blog. The information in this blog is just my opinion, it may not reflect reality. Stock market investing is risky - you can lose all, or potentially more than all of your money given certain market conditions. Not only can you lose a lot of money buying shares, you can also lose a lot of potential profits by selling shares at the wrong time. So please do not buy or sell shares because of information in this blog. Whether you buy or sell shares is your decision as is the decision when to buy and sell. Do not risk any money you cannot afford to lose. Do not risk any money if you do not fully know and understand what you are doing.

Monday, July 11, 2011

Dow makes potential reversal pattern

The forshadowed resistance on the Dow (12,750) is holding - so far. Friday's pattern (Harami candlestick) indicates a potential change in trend. A new closing low on Monday on the Dow would probably confirm a reversal (of some kind) of the current uptrend.
     On the All Ords, although the chart picture is different, the signal we are looking for is similar. The All Ords is now right in the first level resistance (yellow ellipse). That ellipse has turned back rallies 3 times in the decline from the April high. Friday's low on the All Ords is a key. A close on Monday below Friday's low (XAO 4675) would likely spell the end of the current rally. If that were to happen, we will probably see a second candlestick reversal signal form.
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