After dropping 376 points yesterday, the Dow Jones Industrial Average is set to open down 95 points which would put it below the psychologically important 10,000 level. In my previous post, I mentioned that the ‘flash trade’ prices were real and we were heading for a retest of those lows. Currently, the major averages are now trading in oversold territory. That’s the good news. The bad news is that if the February lows are breached, it raises the odds for steeper losses.
Daily chart of the DJIA illustrates the oversold condition.
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