MPT Rating (01)

25. August 2008 by admin.

Monday, August 25th, 2008; MPT Rating (01) 

I was looking for the market to consolidate today, but not that much…  In the end today’s activity did not effect us as we were in cash, at PerfectStockAlert.com but it did send us looking for a buy opportunity and we found a nice one.

The DJIA shed more than 250 points today closing down 241 points, but this is nothing that can tell you anything other than we needed to consolidate after the 3 up days last week, and this pullback was in line to be nothing more than a natural correction, even though it was a big one.  Can the market bounce tomorrow?  Absolutely, and after a major 241 point loss in a single day I would be surprised if it did not at least try to rally tomorrow morning.  The slow stochastic indicator on the 6 month daily chart is no longer heavily overbought and this also tells us to be looking for a bounce, though there is room for further selling in the average so be selective.

The NASDAQ lost 49 points for the day filling the lower gap formed Friday, but creating an upper gap formed this morning which I believe needs to fill before we can see the bottom drop out of this market. The pullback today, though closing below the uptrend line did not undercut the previous low on the 6 month daily chart and that means the average could easily bounce tomorrow, but from this position you can not tell what it is likely to do as the slow stochastic indicator is at about the 50 line, and that means it could go in either direction justifiably… but I am betting on a bounce sooner then later.

Today’s MPT (Market Power Trend) Rating, which tells us what “Smart Money” is doing in the market and where support/resistance is came in at (01); this tells us today’s sell off fell to a support level, and that further provides strength to the bounce theory, though it could start off with a premarket sell followed by a burst of buying in the attempt to reverse course higher.  All in all I am looking for a bounce attempt.

As Always; Be Smart, Be Patient, & You Will Be Successful.

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