The Sunny Side of the Street
MONDAY NIGHT - March 10, 2003
INDU_D_20030310.jpg (180623 bytes)
Figure 1- Daily INDU [click to enlarge]

The motion today, if you don't count the opening hour, was once again commotion.  The opening hour really accounted for most of the movement of the day.  So once again, there was very little money to be made in the intraday arena.
As I said last night, if the QQQs broke below 24.43 (and they did) then I would be shorting, which I did.  Also last night I admonished readers that I was only looking for very short-term trades, and I went short only until the QQQs hit 24.00 and then exited.  Not a very exciting trade, but that's all there was.

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Figure 2- QQQ 15-min chart

In all likelihood, tomorrow's action will be to bounce upward from the 24 line and head back up to the Attractor at 24.45.

Today's daily chart of the INDU, when viewed as a Candlestick chart (Figure 1) stopped neatly at the bottom of yesterday's shadow.  That is a small sign of strength and that's why I expect tomorrow will head back upward, even if only slightly.

Another phenomenon apparent on the daily chart of the Dow is that today's low was the same as the low of July 24, 2002, and the same as the congestion lows of October 2002.  That also signals a potential turning point here, and makes me think tomorrow might be an upward bounce.

Am I saying the fall is over?  Absolutely not.  I am just thinking that a quick long trade might be in order tomorrow.  Remember that I look at the ATR to see just how far the move might go.  The daily 14-period ATR on the Dow is nearly 150 points, and the Daily ATR on the QQQ is just at 62cents.  Computing a rough estimate with that information gives me 0.62*5000 = $3000 to work with.  I generally figure I can catch 40% of a move (if it is unidirectional), which means there could be $1,200 in there somewhere.  

If the morning QQQ breaks above 24.13 I'll be buying.  It should then pop on up to about 24.45 and I'll be jumping out.

Keep your eyes and ears open and be on the alert.

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Watch carefully & stay on your toes.  Just when you think you know the answer, the market will turn on you.