It does look as thought another attack on the 1200 support of the NDX is on its way. Basically, a third attack usually might do the trick and break through. The pattern is also negative, since after the first test the high was higher thereafter, now we come from a lower high which are weak indicators. After closing below 1200, we can expect at least 100 points lower but even 200 are possible. Next Tuesday the FED will cut by 50 BP, which might spur a brief rally but I think we will have broken lower until then. Financials are a weak component again and will remain so for another 1-2 weeks. The Euro though is close to a temp low around 1.25 and might spur a little rally in commodities next week including Oil - so next week might get a bit tricky. More as the day progresses.
Thursday, October 23, 2008
NDX technical outlook - testing the 1200 support
It does look as thought another attack on the 1200 support of the NDX is on its way. Basically, a third attack usually might do the trick and break through. The pattern is also negative, since after the first test the high was higher thereafter, now we come from a lower high which are weak indicators. After closing below 1200, we can expect at least 100 points lower but even 200 are possible. Next Tuesday the FED will cut by 50 BP, which might spur a brief rally but I think we will have broken lower until then. Financials are a weak component again and will remain so for another 1-2 weeks. The Euro though is close to a temp low around 1.25 and might spur a little rally in commodities next week including Oil - so next week might get a bit tricky. More as the day progresses.
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