DJ

Look at this chart, DJ has just fallen 600 point plus and is about or almost surely breaking out to the south of the trendline from the early 90s, it has already broken out a second trend line [from 1994] to the south which makes it very bad.

The lingering support now is 7500.

Hopefully it is not all gloom and doom as the moving averages [in mths] of 10, 20, 50 pointed to a very sharp rebound once it hits a short term low, check the ma on this chart between the years from mid 99 to about 2002 for a similar pattern which might resurface in this downfall, but dont forget that DJ will retry and hit new lows after the sharp rally.

When will this end? It is anybody's guess, but there are clues:

• an exhaustive volume of 2-3 times the 3mth average couple with a sharp fall of at least 500 points or more;
• a spike in LIBOR causing a panic selloff and then rates started to level off and trend lower; without rates trending lower, the fall will continue as it indicates trust is still to be found between FIs or between depositors/FIs.
  
• at least after the year end as banks are scrambling now to get funds ready for year end reporting and write offs;
• a gm/ford filing for chapter 11 bankruptcy, 6-9 months after it the recession may come to a close

The sequence of materialization is not known, 1 and 2 might happen simultaneously or in sequence, any three of the above happening in sequence or simultaneously might hit at least a short term low limiting further fallout for a while.