Week 20 (17th May-23rd May): Weekly Moo River Watch on America (dow)

Dow

(based on 30 year advanced data charts)

Yearly

Dow is slightly different from SPX500. This one stands upon Wilder's smooth moving average and has managed to get above the bollinger midline, yesteryears' support, which is again turning into a support near the psychologically important 8000.

The most puzzling thing on yearly is the RSI which is lying on the lowerbank in the downstream moo river from 2008. Well, they say even dead cats hit the ground and would have bounced up, but dow did not and it seems it is lying there quite cosily. All the other momentum indicators are still bearish. So what is happening to dow?

On the price chart, if we can stay above 8000, ultimately this year, we could top out near 11228, that is when the RSI finally decide to raise itself off that lowerbank.

Quarterly

Let's make no bones about it, there are absolutely no upstream moo rivers here, on price or on all momentum indicators. So it is a bear market rally we are having here.

Price chart: an initial challenge is near 8828, though 9000 is a big number which tickles a few fancies. Ultimately, a challenge of 10000 is more interesting a challenge.

There are no correlated W's to support any bullish fantasies yet.

Monthly

If you look at the RSI chart, you realised that we have just avoided a major calamity in March 2009, as we are stuck in history's biggest downstream moo river with four banks altogether, two upperbanks and two lowerbanks. In March, we almost fell through the lowerbank 1, towards lowerbank 2, until someone realised that we were headed for zero or minus, which was mathematically improbable. Now, we have just risen through the floor of 30 and is headed to a more healthy 40, where the challenge for the bulls' resolve will be immense and there is no guarantee for an instant success there. We might have to come back and shape up a W to rally through 40 onto more happy days for bulls.

If you look across the monthlies, it is not very satisfactory for bulls with the lack of W's there and everywhere you look, it feels like two arms short of a healthy and bullish W, which means another dive down and a quick rise up, but the timing of it is unclear, unless it is a V shaped rally.

Weekly


It looks so similar to SPX500. It stares at you that a very volatile week is coming up, either a big up or a big down, and there is no third way about it.

How spooky it is that we closed Friday at 8288! One wonders whether this global stock market rally is conducted by a Chinese!

I will put some weekly numbers in the weekly forecasts and results post later on.

Good luck.