Spread Betting Opportunities: November 9, 2007Friday November 9, 2007
In this edition, I analyse the immediate outlook for one of the most popular equity indices for spread bet traders, the Dow Jones Industrial Average.
Short Term Market Outlook: DOW JONES
The most recent chart of the Dow Jones Industrial Average is presented below.
Since hitting resistance around 13962 in early November, the Dow has tumbled lower, eventually breaking below the important price support level around 13400.
The question then is where is the index likely to find important price support that may act as a solid foundation for a short term price recovery? Thursday’s market action provides some clues. Having lost ground from the opening bell, the Dow traded all the way down to 13079.48 before staging a strong rally into the close, eventually moving over 186 off the session’s low. That bullish move—if followed through on Friday—may provide the short term respite that could take the index much higher.
From current levels, despite all the recent volatility, there is now a strong evidence of underlying bullish sentiment in the index. For that bullish move to materialise however, the important question is whether or not we can get a follow through on today (9/Nov) to now get a close above 13350. Such a move would likely take the index all the way to 13500 and then 13680 or much higher.
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