Tuesday, October 18, 2011

Dow Jones Is Due For More Pullback

Wall Street recap: Dow Jones down 247 points as Germany damps optimism
After surging 4.9% last week, the Dow Jones tumbled 2.1% to 11397, as Germany downplayed the notion of a quick fix for Europe's debt trouble and a New York-region index illustrated ongoing weakness in manufacturing activity.

On corporate earnings, Citigroup profit beat estimates but IBM and Wells Fargo earnings trailed estimates. Other key results this week are Apple/Coca-Cola/Intel/Goldman Sachs (Tue), American Express (Wed) and Microsoft (Thu).

Wall Street outlook: Dow Jones: Due for more pullback
With the overnight plunge on Dow and more key corporate earnings to be released this week, Wall Street will be bracing for more volatility ahead.

We reiterate that the Dow Jones is expected to continue range-bound trade within the box until a clearer solution from the debt crisis in Europe and pending more companies’ guidance during the ongoing 3Q reporting season.

Major resistance levels are 11600-11800 while crucial supports are 10800-11000 points. A break below 10800 will drive the index lower towards 10400-10600 supports.

Daily Dow Jones: Volatility Ahead
DowJones18-10-2011

Weekly Dow Jones: More Sideways Consolidation Ahead
DowJones18-10-2011a



Source: StockCharts.com

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