DJIA Enters Confluence Region

DJIA has crossed the 11000 milestone and has just enter the confluence region indicated by the orange box. This orange box is similar to the lavender box which enclosed the congestion period around late June 2008 to late September 2008. Within this orange box are 2 probable resistances :-

1. The measured move projection of the inverted head and shoulder breakout as shown by the red dotted line.

2. The 61.8% Fibonacci Retracement taken from the Oct 2007 all time high to the low on March 2009.

Stay alert as probable reversal may be triggered within this confluence zone.

Cosco Testing Ichimoku Kumo Support on 30 mins chart

5 April 2010
Broke out above 1.27 and began a fantastic run up to 1.85

8 April 2010
Pulled back to 50SMA and 50EMA supports.

9 April 2010
Gapped up on opening from previous day close. Almost touched Ichimoku Kumo support and an amazing rebound propelled price towards 1.85

15 April 2010
Early morning trades established 1.85 peak. Pierced 50SMA and Ichimoku Kumo support but managed to close above both the 50SMA, 50EMA and the storm clouds.

A breach of these 3 supports and the gap support at 1.73 will see further weakness. A breakdown below the red channel will retest the next support zone at 1.67 to 1.65

However a successful rebound from the Ichimoku Kumo support will meet resistance at the upper trendline of the red channel. Any further upthrust must challenge the 1.85 peak convincingly.

Noble Doji Testing Triple Support

Doji testing triple support comprising of :

1. Ichimoku Kumo Cloud

2. Lavender support band

3. Green channel support

A successful rebound here will propel price back into the red channel and retest 20SMA resistance followed by blue resistance zone. Further upthrust may result in a potential triple top.

However, if the doji rebound fails then an imminent drop to 100EMA is inevitable. Strong support at the orange support band must prevail to arrest further decline. Support failure near the 3.00 milestone will probably plummet price to retest the green and pink support regions.

Raffles Education Dragonfly Ready to Fly ?

Dragonfly resting after rebound from green support band and blue channel support. Immediate support is the dotted lower red channel boundary followed by the blue support belt. If buying interest continues there is a high probability of testing the median line of the blue channel. A strong breakout above this median resistance line may propel price towards the upper boundary of the blue channel. Use the coloured bands as potential support and resistance zones.

Yanlord Testing Double Resistance Zone

Testing of double resistance formations

1. Dual upper resistance boundaries of green channel

2. Blue resistance band

Breakout above these 2 resistances will test the dual central resistance band of the red channel and challenge the pink resistance zone. If buying continues above this pink zone expect probable resistances at the colour bands indicated on the chart.

However, if the Big Bulls cannot clear the blue immediate resistance band a pullback towards the light blue support band is imminent.

Noble Testing Gap Resistance Zone

Kudos to those who bought at the confluence support zone. The rebound from the 100EMA support is now being tested at the light blue gap resistance band. A breakout above the gap resistance band will meet more resistance within the red dual trendline region. A successful upthrust here will probably see a retest of the previous peak formed on 17 March 2010.

However, failure to clear the light blue gap resistance will result in a pullback to the 3.15 to 3.14 immediate support belt. Further weakness will retest the 3.08 to 3.07 gap support band and retest the major confluence support zone again.

Noble Testing Major Support Confluence Zone

Falling lower and lower since 17 March 2010 peak. Gap down and more declines. Now testing critical support confluence zone consisting of the following supports :-

1. 100 EMA

2. Ichimoku Kumo Cloud

3. Lower boundary support of green channel

4. Orange support band

If this support confluence region is unable to halt further price decline the next probable supports are as follows :-

1. Green support belt

2. 145 EMA

3. Pink support zone

4. Trough at 2.64 which is the breakpoint reference for the double top pattern indicated by the grey oval shaded area on the chart. Support failure here confirms the double top formation.

However, if the testing of the current confluence support zone results in a rebound expect major resistance at the light blue gap region.