Dow and S&P 500 find support

By Colin Twiggs
August 12th, 2014 3:30 am EDT (5:30 pm AEST)

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Dow Jones Industrial Average continues to test medium-term support at the December high of 16500. Breach of support would warn of a correction to the primary trendline — at 16000 — while respect of support would indicate another attempt at 17000. Failure of primary support at 15400/15600 remains unlikely, but would warn of reversal to a down-trend. Completion of another 13-week Twiggs Money Flow trough above zero would suggest long-term buying pressure and another primary advance.

* Target calculation: 16500 + ( 16500 - 15500 ) = 17500

The S&P 500 found support at 1900. Recovery above 1950 would suggest another advance. Breach of primary support at 1750 remains unlikely. Completion of a higher trough on 13-week Twiggs Money Flow, with recovery above 32%, would indicate that buyers are back in control.

* Target calculation: 1500 + ( 1500 - 750 ) = 2250

The CBOE Volatility Index (VIX) retreated from its recent high, suggesting continuation of the bull market.

We have forty million reasons for failure, but not a single excuse.

~ Rudyard Kipling