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DOW's 1/3rd re-tested yesterday, when will the recent low be re-tested again? |
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Written by Edward Chen
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Friday, 03 August 2007 |
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The 1/3rd retracement at approximately 13,500 was re-tested yesterday. The recent lows ought to be re-tested in a matter of days. NYX (New York Stock Exchange Euronext) seems to be aiming to re-test the recent lows as well.
Last Summer, it took the DOW 21 days to re-test the correctional lows. Earlier this year, it took less than 8 days for a re-test. DOW should have little or no problems reaching the 20 days moving average (center of the Bollinger Band). If so, next week ought to be a heavy momentum up-week, which also happens to be the week before options expiration week. It would be ideal to get a 50% retracement, have the recent low re-tested after that and for both to happen by options expiration week. (Hint: Check out what happened last month on the week before options expiration week.) The market will always be right. Expect the unexpected. Plan ahead of time what to trade before the market does something. And trade the plan when the market does it. |
