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Dow Sell-off Not Likely a Reversal

by Sam Collins 09/24/09

Dow Jones Industrial Average (DJI) -- The Dow triggered our own internal Collins-Bollinger Reversal (CBR) to issue a sell signal, but the volume was relatively light, and the selling all came at the very end of the day, which is a pattern for normal profit-taking rather than a serious trend reversal.

Dow chart

The CBR signal must be tested for three trading sessions before becoming valid. And if the signal is reversed back up within those three days, then it could become a powerful buy signal.

The first support for the Dow is at its 20-day moving averages at 9,594.

The CBR signal must be tested for three trading sessions before becoming valid. And if the signal is reversed back up within those three days, then it could become a powerful buy signal.

The first support for the Dow is at its 20-day moving averages at 9,594.

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