Railroad stock markets - boring but strong
To analyze the stock markets, we should always cite those indexes which cover a certain market range. The more stock titles are integrated into an index the better are the results and the sounder will be the turnout of the analysis because within an extensive index, the manipulation by the market setters is virtually impossible and the "true" trends come to light.
While the extensive indexes are felt to mark time, in the case of Dow Jones a very different phenomenon can be made out.
The situation: Dow Jones is running like clockwork straightly to its main target. It is situated in the bullish half of the setup. Last week happened a half-hearted 3rd test of the Gann Angle that is anchored in the 8 Candle GUNNER24 Up Setup. Even though the price is in the resistance zone having closed within it for the sixth time, there is no correction any more.
We are in the 41st week with rising prices, 24 weeks of them have marked new highs. For the next week, that means with a 100% of probability another course high again. Since we always have to take into consideration the Fibonacci numbers as well thus we can expect the final high by the 55th week.
According to the Fibonacci count, the main target should occur by the middle/the end of March just like in the case of the other indexes (S&P 500 and Nasdaq 100). The thing that doesn't fit completely is the time target which in the case of Dow Jones, the GUNNER24 Up Setup indicates between 10980 and 11120 by the end of January already.
In comparison with that, here you see the NQ # contract.
The time zone for reaching the main target starts by the beginning of March. Since the week before last the price closed within the 4th double arc without much resistance now definitely the main target 1961 is activated. Considering now the conclusions on monthly basis (GUNNER24 Forecasts 11/22/2009) the yearly final rally should start next week, well, it has got to!
Because of the easier practicabilities to let the Dow Jones optically look better than the wider markets we will have to take into consideration the possibility to shoot over the 3rd double arc in the case of Dow Jones and then A) The market setters might drive the market up to unfathomable 13000 by March, 2011. B) In the case of Dow Jones we have to adjust to the possibility of a setup failure. That means we would clearly break the 3rd double arc on final quotation basis but then we would not reach the 4th double arc.
About all the market analysis, my attention is attracted by the fact that we have not experienced any buying panic, not even an easy one. The exhaustion is not only completely absent, but not even the slightest beginnings are to be seen, no jumps, no pullbacks, well, there's just not any nervousness in the market.
What does the theory say? It's a strong trend if nobody realizes it, and undoubtedly that is the case in the stock markets.
Let us finally take a quick look at silver. I would like to introduce you to one of both GUNNER24 Down Setups since the high of March, 2008.
The situation: In the 3 Candle Weekly GUNNER24 Down Setup, on Friday the silver contract marked a possibly significant low at the upper line of the 2nd double arc after rebounding rather heavily exactly at the Gann Angle, the week before last. That might have been the starting shot for the final exhaustion move with the expectable final high of the swing by the end of February, 2010.
But just like twice in the past already (green marks) the down move might find its swing low not above the lower line of the 2nd double arc. From my point of view, that means silver would have to give up the Gann Angle which it had conquered already. At the same time, that would mean the switch from the up to the downtrend.
Tactics for next week are simple. On daily basis, we will wait for a reversal candle and then go long. If Monday or Tuesday a new low is formed it should happen exactly at the Gann Angle. Until then at the latest the price may still fall.