On the Daily Chart of Dow, price is resisted at the 200-days moving average. On Thursday 3rd June 2010, Dow attempts to break the 200MA and tested the high of 10,315. However, the key thing to note is end of the day, it failed to close above the 200MA and therefore, now the 200MA became a ceiling for Dow.
There is also seemingly a head & shoulder pattern (although the right shoulder does seems ugly) on Daily Chart, which might paint a reversal of a bull trend started since March, 2009. Something interesting to note is that price has been holding and closes above the 9,900 mark which is also the head & shoulder neckline support after the error trade incident on the 6th May, 2010.
However, if Dow were to break and close below the 9,900 mark and the neckline support, next potential support would be 9,684 as identified by Tflow®. The next immediate resistance would be the 10,000 mark which is also the psychological level where traders might want to look out for.
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excellent analysis !!! Carnage ahead
Head and shoulder or not, it is undeniable that the ‘neckline’ would be critical support. Once this goes, we have a bearish reversal pattern.