Forex Trade Signals and Setups Aug. 4th
DOW – Sheds 512pts in one day. More losses to come?
What else should we be talking about today but the DOW which shed over 500pts in the NY session and looks to be sold further in Asia and European markets. We’ve been short DOW since 11690 and with the massive drop in the European markets, followed by the NY session getting hammered, we do not feel Asia will be able to do anything to stop this train.
Thus, look to sell into rallies. But the key question becomes where?
Considering the index broke the 2011 lows and the Nov. 2010 highs (also swing high as you can see on the chart), we feel these are great locations to sell any rallies should they materialize. But as we tweeted today on our twitter acct (2ndskiesforex), we felt if the DOW broke the yearly lows at 11521 and 11467, then 11249 becomes a likely target early next week and possibly 10975 which was the Nov/Dec 2010 support base (See chart below).
For now, being long the DOW seems insane considering the index has sold off 8 out of the last 10 days and shed over 1400pts in such time. Honestly, we could be seeing the start of something huge reflective of 2008. Crude
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