Dow Jones chart analysis

 

After the QE3 annoucement, the Fed had pushed the Dow Jones index to the top channel of the bear flag. With one month to go into the US election, will Dow Jones break out of the top channel or will it retract back to the lower channel?

STI condition before Fed QE3 announcement

I am looking at the chart of STI before Fed's decision on whether to release the QE3.

It is forming an inverted cup pattern which is very bearish. Currently at 10.55am (13th Sep), STI is trading at 3017. Whether the Fed announce it's QE3 or not, the picture does not look good for STI. Will STI rally after Fed announce the QE3? or no QE3 at all? According to the chart at the moment, it does not look to have a bright picture.

Dow Jones index

It was such a long time since i last updated thus blog. It has been a great upride to 12800 for DJ. At this junction, it will be a real test.

As refer to the above chart, it is travelling nicely along the 10DMA line. It is due to a pullback or correction now. Please exercise real cautious for those who are buying.

US market

Tonight US will release it's job market data. I feel that tonight's data will be the most important indication for the market. Let's take a look at it's chart.

Currently, Dow Jones index is sitting just below the major downtrend line. If tonight's job data delight the investors, it may break the downtrend line and things may turn over to the bull side. STI may follow on Monday, a gap jump above the downtrend line. But if tonight's job data disappoint the investors, we may face extended period of under the downtrend line.

US markets lead the way. What's worry me is that current futures are indicating the bets are siding the bull side. When everyone is betting on the green side, it usually doesn't turn out to be green. Will this happens again tonight?

Market analysis, Capitaland

The analysis is for my friend, Joe. Let's take a look at STI situation first.

For the downtrend wave to reverse, the major downtrend line stated in the chart (started from August) have to be broken. It looks like at around 2800. Currently, the inverse H&S formation looks like going to form. This is a bullish formation but it needs further confirmation. For example, it breaks the neckline of 2905 or breaks the major trendline. At immediate short term, it has not broke the 10DMA of 2723. Any rallies may just be a short term rebound.

Capitaland

Currently, Capitaland still refuse to break $2.54 even Dow Jones rallied 293 pts yesterday. This price is the short term 10DMA. So i feel that the rally is not strong enough. Personally, i will only buy it as near to $2.35. The risk will be lesser. Another point of entry will be the breaking of $2.54, the formation of inverse H&S may happen.

This is just my point of view, Joe. You may have a different view.

Dow Jones

From the above DJ chart, we can see the status of the market at the moment. It is trying to break out of the critical trendline. 12200 will be a key breakout at the moment. It seems like waiting for something to trigger the breakout. The Asian markets had been lagging behind the US market.

Please take note of the breakout, it may mark the end of recent downfall.

Capitaland

Sell Capitaland at $2.74 on 31st Oct 2011; Buy at $2.49 on 23rd Sept

Trade decision conditions:

1. Expect a pullback from STI after rallied for more than 300 pts
2. Time to log some profit from Capitaland as i faithfully held it for a month

Profit: 10%