What's the target for both bears and bulls ?That's a key question I try to answer tonight, just based on the chart.
First of all, since we mentioned the broken of the first support level (the green line in the chart) Monday, this line has become a key life line for the battle between the bulls and the bears.
So far the bears have successfully kept bulls below this line. Unless the bulls become crazy again, this line seems hard to get back by bulls. That's why I called a broken out of this green line is really needed by the bulls for a nice home run.
So far, the bulls have retreated 3 days from the green line. Do you think the bulls are tired now ? In my opinion, I think such retreat is very good for the bulls. A broken out of the green line is very expectable. Once broken out the green line, the bulls target will be the red line as marked in the chart.
My years' chart reading experience told me that the correction before the important broken out will always help out the breakout and will always lead to a successful brokenout.
Another important thing, I think I should mention here, is that the ~10 MA is today's low and the ~5 MA is today's market close. It's not accomplished by chance. It is so because these levels are very important levels, and many traders are watching them.
On the other hand, if the bears keep the green line well from the touch of bulls, bears will push the market down to test the support of 1770, which is marked as a key support about 10 days ago in this blog. It is also plotted as a black line in the chart.
More fun are coming ! Enjoy !
