2 Time Frames Analysis (2010-08-07 DJI analysis)

With a fall of 131,000 in US employment in July, while the estimation was a decline of 65,000, DJIA opened low yesterday. You might question whether the markets would continue being bullish or reverse. Technical Analysis on DJI gives us clues.



Let's see the Daily chart of DJI . It was beautifully supported by the uptrend line and a bullish rejection was formed last Friday, showing a strong bullish view by investors. MACD and EMA touched again, however, we could see that they had touched twice before but actually they didn't cross. This is likely to happen again this time.

The hourly chart further enhances.

The red line is the same as that in daily chart. We can see that MACD and EMA are at the level around 0, and a bullish cross appeared. The index is going to reach 10702 again, but to break this resistance, a higher volume has to show up to give it a hard push. I believe it will still be in bullish in the next few days.