Sunday, February 22, 2009

Basing?

DJ plays out the 1-2-3 selldown pattern I suspected since Nov 2008.

Nothing is certain in the markets. I wont rule out a reversal to the upside, as UJ is shaping into a reversal setup.

Updated March:
UJ breakout and hit TP as setup, but DJ broke down instead. Did not "expect" the divergence. I am arguing with the price, obviously.

THE LESSON:
Divergence is there for a reason, respect it and not go against it.

Updated May:
That time was still in short mode according to system z. The yellow area resistance is indeed broken, but 1 month later. Incidentally system flashes buy signal on breaking this resistance, which sees DJ rallying from 7500 to 8500 till date.