DOW rebounds rather strongly in early session, up more than 200 pts. It’s not unexpected as DOW hit 61.8% projection of 26951.81 to 24899.77 from 25817.68 at 24549.51 yesterday. It’s also trying to draw support from 55 week EMA (now at 24565).
We’ll have to see whether such rebound can gather sustainable momentum. But for now, with the index staying well below 55H EMA (now at 25252), more decline is expected. Break of 24533.19 will target 100% projection at 23765.64 next.
A break of 55H EMA will indicate short term bottoming and bring stronger rebound, possibly through 25817.68 resistance. But that doesn’t change the outlook in the bigger context.
That is, fall from 26951.81 is seen as correcting whole up trend from 15450.56. Further decline is expected to 38.2% retracement at 22558.33 before completion. It’s just a matter of going straight to this fibonacci level, or have an interim rebound first.
