US market: Down Trend waiting to resume

In my previous article, I mentioned that the US market is still uncertain and a rebound is expected. However, the US market continues to be weak. Weak financial results were posted and giants like Microsoft, Shell and others are reporting quarterly losses. Recently, the U.S. House of Representatives approved another US$819 billion stimulus bill that investors hope will help lift the American economy out of its worst crisis in decades. Thousands of workers are being laid off due to the current economic slow down.


Daily DJI chart as at 29 January 2009 using NextVIEW Advisor. Click on chart for larger view.

The DJI traded in a volatile range between 7,900 and 9,080 points. The DJI so far is able to stay above the 8,000 points support level and is now at 8,149 points. The down trend is waiting to resume and from the weakening bullish momentum, it looks like the support may not be able to hold long. Support and resistance level remains at 8,000 and 9,000 points. Expect DJI to move into a more bearish mode if it breaks below the support level and stay below it.

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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.