The Fed cut rates 50 bps today and the Dow’s rally was short lived. In fact, the rally lasted about 60 minutes and had a rapid descent to close 37 pointslower. Throughout the day, the Dow was trading flat and around 2:15 PM we see a break to the upside. At about 3:15PM you start to see the rapid descent or the “avalanche”. Let’s take a look at the 5 minute chart:
Dow Jones Industrial:
- Bear Flag continues to form
- Near Term Resistance is 12487 (broken today with lackluster volume).
- Near Term Support is 12112
- May continue its downtrend after tagging the 20 period MA.
NASDAQ:
- Near resistance and had a similar open and close price (Doji). Its quite possible that the prices may dip downwards in the next few trading days.
- Near term resistance is 2415
- Near term support is 2306
- Short Term Trend: Down. Intermediate Trend: Down. Long Term Trend: Lateral
S&P 500:
- Looks Similar to the bear flag in the Dow.
- Near Term Resistance is 1368. It was broken today on average volume but retreated back to 1355 for today’s close
- Near Term Support is 1322
- May continue its downtrend after tagging the 20 period MA.
- Short Term Trend: Down. Intermediate Trend: Down. Long Term Trend: Lateral/Down
Conclusion:
Although there was a short lived rally today, I believe that the bears are still winning across the board.
Trade Safe!