The SP500 also broke its support, but it did not drop down to test its November 2008 low.
Likewise for the Nasdaq 100, it gapped beneath the 50 SMA support and dived down to the 1190-1200 level to test for support.
At the end of the trading session, the DJI closed 0.31 point above the November 2008 low. For a brief moment before the DJI was settled, it actually printed the exact closing number as November 20, 2008, 7552.29. So how significant is the 0.31 point away from the previous closing low?
If you are a true market watcher and a bull, this 0.31 is very significant. You would have wished the DJI had closed 0.31 point lower to closed at the previous closing low or closed with a new low today. Although this DJI new low would have been a confirmed low by the DJT new closing low made today, but it would have represented a turning point for the market. For you true market watchers, you'll know what I'm talking about. For those that do not know what I'm referring to, I will elaborate when the DJI actually closed with a new low on a day similar to today (not to miss the post when it occurs, I highly recommend that you subscribe to this blog either via email or RSS reader and you will be notified whenever I make a new post).
To see what is the likelihood for the DJI to bottom in the month of February, I went and check the daily close from 1970 to 2008 and found only once the DJI made a market bottom low in February. On February 28, 1978, the DJI closed at 742.12 to put in a bottom for the bear market started in 1976. Not to say it is not probable to see the DJI bottomed in February, the odd for it to do it is quite low. Does it mean we won't see a lower low until after February? Absolute not. It only mean if any new low to occur in February, the odd is there will be lower low to come before the market bottomed. But lets not get ahead of ourself by speculating what the market might or might not do. Like any good student of the market, I will continue to pay attention and listen to what the market has to say and act accordingly. For now, it is saying it will go lower.
Gold have been making a move since my last post on it. I will put up a new post on gold soon.
