Mike's Mid Day Minute is available to members on Monday, Wednesday & Friday evenings, with one article per week available to non-members. Members please login and see "Mike's Mid Day Minute" in the navigation menu towards the top of the page.

Dow in Bullish Continuation Pattern


Dow in Bullish Continuation Pattern
By Michael Paulenoff, MPTrader.com

Here is a look of the condensed DIA hourly chart, which shows the June-July bottom, followed by the 45-degree angled "railroad tracks" that comprised a very powerful uptrend between mid-August and late-November -- followed by nearly 3 weeks of sideways action that resembles a "mini" version of the June-July pattern.

Right now, my sense from the pattern and the underlying oscillators is that the 3-week pattern represents a bullish continuation period, that will resolve itself in a thrust to new highs that projects next into the 125-126 target zone. At this juncture, only a decline that breaks the 120.80/70 support plateau will wreck the pattern and morph the 3-week period into a very significant top to the July-Dec upleg.

Furthermore, a break of Friday's low at 122.32 will trigger a preliminary alert that a decline towards 120.80/70 is gaining traction. Barring such weakness, the bulls remain in directional control, looking to ignite a thrust to new highs -- perhaps in the aftermath of the FOMC meeting tomorrow afternoon.

  • Action-Oriented Trade Set-Ups in Stocks & ETFs
  • Macro Analysis of the Broader Markets
  • Detailed Technical Guidance for each Trading Idea
  • Live Interaction w/ Mike & Our Member Community
  • And Much, Much More!
Join Now! - Special Offer!
Veteran Wall Street analyst and financial author, Mike provides detailed and timely analysis and trade set-ups on a range of markets. Read more...

Have Mike's “Out Front” morning analysis delivered FREE to your email inbox twice weekly!