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Dow has short-term bear's attention

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A quick reversal lower in the last 40-minutes has the Dow Industrials (INDU) 8,448 -0.53% breaking below Friday afternoon and yesterday's support and triggering what looks to be a head/shoulders top pattern on the shorter-term time frames. Today's more "pronounced" move below the 8,465 level may offer short-term traders a little stocking stuffer on this trade shortened session with an end of session goal of 8,385.

Dow Industrials Chart - 10-minute interval

On Friday of last week, the Dow gapped higher from its lows and looks to have formed a head/should top on its shorter-term 10- minute interval charts. The "neckline" broken at 8,465 taken from the "head" at 8,550 gives a downside objective of 8,385 and would tie in nicely with levels identified on the Dow's 10-minute chart. The "first hurdle" of support from current levels that a bear needs to clear in order to achieve his/her target of 8,385 would be the first little 10-minute pullback found Friday morning of 8,426.

Traders not looking to establish an options position with a shortened trading day today and markets closed tomorrow might look to a short in the Dow Diamonds (DIA) $84.60, stop 84.80 to begin, with target of $84.10.

Jeff Bailey

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