The Morning Call + Subscriber Alert + OK, I am confused

The indices (DJIA 12496, S&P 1318) pin action the last two days has been about as confusing (to me) as it could be. Before going into that, it is important to note that they remain well within their intermediate term uptrends (11668-16668, 1226-1793).

As for the short term, recall that Tuesday, the Averages traded above the descending very short term downtrend, then failed to hold. I concluded that pin action pointed to more downside. And yesterday the trading for the first 75% of the day confirmed that with the indices falling big time, trading down to the lows of last Friday (12344, 1292). Then late in the day, they bounced hard and finished the day over that very short term downtrend (12489, 1315).

So it would seem that (1) the 12344, 1292 level gained some strength as a new support level for the short term trading range while (2) the very short term downtrend lost strength. However, the dramatic intraday reversals of the last couple of days gives those conclusions an ‘iffy’ feel. Nevertheless, in a broader sense, the current level has apparently become the battleground for the bulls and bears.

Continued on the Next Page

via allamericaninvestor.blogspot.com