US: TECHNICAL REBOUND EXPECTED ON DOW, MARKET STILL UNCERTAIN

The Dow Jones Industrial Average (DJI) is in a sideway correction mode with a slight upward bias. One month ago, I expected the DJI to test 9,500 points in a correction mode and the DJI that time was at 8,934. In one month, the DJI only managed to climb as high as 9,088 on 6th of January 2009 before falling for four consecutive days to the current level of 8,473.97 points. The US market is still full of uncertainty. Upward rallies are being resisted and a pullback ensued.

The current Israel offensive in Palestine have drawn many protests and criticism all around the world. The US, Israel's major ally have been supporting all the way may face product boycotts. It creates anxiety and concern in investors. The people in the US may not expect major changes in its policy towards Israel when the Barack Obama goes into the White House.

The DJI is currently at the short term up trend line support level. A technical rebound is expected to test the next resistance level. The US market to continue to drift sideways, with a bullish bias. This is beacuse the RSI indicator is still rising, but at a very slow pace. The next resistance is at 9,200 points. Support level remains at 8,100 points.


Daily DJI chart as at 12 January 2009 using NextVIEW Advisor. Click on chart for larger view.

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Article contributed by Private Trader, Market Expert, Trading Coach and Chief Market Strategist of Nextview, Mr. Benny Lee. For more articles and commentaries from Benny, click HERE.

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