The Stock Market Week - 7/11/2008 |
All the major US indices were negative. For the week the Dow Jones Industrial Average dropped 188.00 points, or 1.67%. The Standard Poor's 500 Index dropped 23.41 points, or 1.85%, while the Nasdaq Composite gave back 6.30 points, or 0.28%.
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Dow Jones Industrial Average Trend Analysis
Dow Jones Industrial Average long-term chart is forming a head and shoulders pattern. The projected price decline for a head and shoulders pattern is usually found by measuring the distance from the neckline to the top of the head. This distance is then subtracted from the neckline to reach a price target. The calculation gives approximately 9000 as a rough long-term target. This price target looks very pessimistic now, and it should be considered with other technical indicators as well. Daily and weekly technical indicators are oversold. The neckline (around 11500) now becomes an important resistance level. The Dow Jones may retest this level before moving down to a 9000 long-term target. |
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| Dow Jones Industrial Average - Long-Term Trend |  |
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Standard Poor's 500 Index Trend Analysis
Standard Poor's 500 Index is in the long-term down trend that started on 10/11/2007 at 1576.09. Standard Poor' 500 Index lost already almost 20%. The first down wave had a five waves structure and was completed on 3/17/2008 at 1256.98. Standard Poor's 500 Index is in the third down wave of the long-term down trend. The third wave started on 5/19/2008 and may take five to six month to be complete. In the short-term all technical indicators are oversold. A short-term rally might be expected soon. |
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| Standard Poor's 500 - Long-Term Trend |  |
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Nasdaq Composite Index Trend Analysis
For the last several month the Nasdaq Composite index is the strongest among the major indices. It is retesting the long-term support line, while Dow Jones and Standard & Poor's 500 indices had already broken this line. The current falling channel looks strong, but daily and weekly technical indicators are oversold. The downtrend may pause for a while before breaking the long-term support around 44. |
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| Nasdaq Composite Index - Long-Term Trend |  |
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