The bulls refused to budge despite a barrage of bearish attacks. The Dow stubbornly defended its support line of the Wedge pattern, closing Tuesday’s session with a mere 44-point loss. Prior to that, the Dow had lost over 85 points. The Wedge pattern remains intact.

Basically, we don’t have much to talk about Tuesday’s market. But many people had been making various claims about financial market as a whole. On Friday, the Dow lost more than 120 points; the financial news commentators blamed it to the higher oil price and weaker dollars. On Monday, when the market began to make its rebound, they attribute the gain to the stronger US dollar which led to the lower oil price. Yesterday, the US dollar continued to hold but the oil price surged back to the highest level in intraday trading. Therefore, the weaker US dollar last week did not really have much to do with the higher oil price. For the past three trading sessions, the markets came back to naught after so much ups and downs. However, the commentators had been making all sorts of false claims. This is one reason I don’t take any news seriously for my trades. But don’t get me wrong. I am not discounting all news. We just have to be discerning what news to accept and what to discard. News that is daily-affair in nature should be ignored entirely. Market performance purportedly induced by Individual stock’s move must be disregarded as well.

Enough of digressing. Let’s get back to the market indices. While the Dow was stalled, the Nasdaq (NDX) seemed to perform better. The Nasdaq is making new high. It has a very different chart pattern than the Dow. The chart is bullish. Unfortunately, we can trade it as yet as the market has been very overbought. We shall wait for a pullback before taking on new trade.

While DJIA chart is bearish overall due to its Wedge pattern, the Nasdaq is bullish, as evidenced by its parallel channel lines.

STOCKS TO WATCH:
GM – long or short, subject to next day trading condition.

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