There are also a couple of targets in the DJIA that bear watching: 11410 and, more importantly, 11351. That last number is not a hidden pivot, but rather a point of reference that sits one tick above a pivotally important high made almost five years ago. Any rally exceeding it would create a fresh, bullish impulse leg on the monthly chart, implying that bulls would remain in charge for the foreseeable future.

I should also note that, if the downturn begun from yesterday’s highs gains momentum over the next few days, it could queer the bullish case in a New York minute. That’s because the rally which has unfolded over the last 30 months has been accompanied by declining stochastic peaks and is in fact occurring right now on declining volume. Bottom line: Until such time as the DJIA exceeds 11350, stocks are an extremely risky buy.

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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2005, Rick Ackerman. All Rights Reserved. www.rickackerman.com 

-- Posted Friday, 17 March 2006 | Digg This Article