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  • Dow Likely To Fall 1200 -1500 Point : TVIX, TZA, FAZ, ERY 4 comments
    Jan 25, 2012 5:25 AM | about stocks: TVIX, TZA, FAZ, ERY, SOXS
    Dow likely to fall 1200 -1500 point : TVIX, TZA, FAZ, ERY

    Dow today's chart:
    If you look as soon as dow fell below blue line or rose above blue line, the stock made a comeback into envelope. Once again very thin volume 93 million. Right now stock is flat, but close to reaching upper blue line.
    Dow today's chart
    If you look today Dow crossed the lower blue line and it went outside envelope, so dow crawled back into envelope. If it breaks upper blue line or lower blue line the stock tries to come back into envelope. Right now Dow is sitting near the upper blue line, which suggest stock is going to fall in 1 week time.
    Dow 1 week chart - same way dow is near upper blue line

    Dow 1 month chart - almost above blue line.

    Dow 3 month chart - shows it's overbought

    Dow 6 month chart - its overbought

    Dow 1 year chart - Dow is overbought
    Dow Rsi 66.67

    Dow 5 year chart - it has still little room but very close to upper danger zone. Look at the volume its nothing compared to last 5 year

    Based on the chart, the room for upside is very small. Everytime the stock is overbought or oversold, stocks fall big time atleast by 10 -15% , Dow likely to fall atleast 1200-1500 point. Right now ECB fine tuning operation is saving US market. But if you remember QE1 started on Nov 20, 2008, yet stock hit alltime low by March 2009 and it fell below 7k. Time to buy TVIX, TZA, FAZ

    Stocks: TVIX, TZA, FAZ, ERY, SOXS
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Comments (4)
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  • stockwatch101
    , contributor
    Comments (5) | Send Message
    It's a very nice explanation with some charts. I do believe it's time for a reversal. The market is simply moving upside for no reason with so many issues like Debt ceiling, EU crisis, etc.
    25 Jan 2012, 08:18 AM Reply Like
  • freefdawatchlist
    , contributor
    Comments (24) | Send Message
    Author’s reply » Market is moving upside because of the free money printing press run by ECB every Tuesday.



    Once ECB stops the engine, Dow rally will stop. Lets see how US treasury react to US debt ceiling issue on Jan 27th, when it has said it will default if the ceiling is not raised. It has already suspended G pension fund to avoid hitting debt ceiling.
    26 Jan 2012, 08:28 AM Reply Like
  • RVijay007
    , contributor
    Comments (56) | Send Message
    Nice explanation. However, the difference here relative to the past is that small volume + positive momentum is a bullish indicator, as noted in a couple finance papers (Price Momentum and Trading Volume, 1998). Given that, I'm not sure that now is the best time to enter leveraged short funds.
    25 Jan 2012, 05:15 PM Reply Like
  • freefdawatchlist
    , contributor
    Comments (24) | Send Message
    Author’s reply » Your right but at the same time this market is in overbought zone. The stock can stay in overbought zone for a week and there will be reversal soon. Trend cannot ignore fundamental macro issue for long such Europe crisis or US debt ceiling issue or Baltic Dry Index. Low volume has a big reversal as well.
    26 Jan 2012, 08:25 AM Reply Like
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