Breakout - A 13,750 DJIA Target?

DJIA + 189.87, +1.48% SP500 + 23.75, +1.71% NASDAQ Comp. + 67.91, +2.81% Russell 2000 + 13.57, +1.89% Like April, May begins with a bang! The Nasdaq moves a monster 2.81%. Friday will show us if this breakout is for real as it appears to be. Unemployment and non-farm payrolls are due before the market open. If this breakout holds the chart is giving a target of 13,750 on the DJIA. There is a great market lesson in today’s move. One of the core principles of technical analysis is that market action discounts everything. We have been writing and commenting in our audio comments that the price action at resistance over the past 8 days has been different than in the prior three months. Why? Apparently buyers were absorbing selling at higher prices for more days than anytime in the last three months. Were the clues in the Chart Signals? Yes. Did the chart know the future? No. But did the chart suggest that buyers were doing something different now and therefore a trend change was becoming a higher probability? Yes. Dave’s Insight: We must never confuse probability with certainty. Always think in terms of probability and maintain mental flexibility. Today’s Action Moving Up AAPL, ADBE, APOL, LAMR, MICC, SNDK, SYMC, VRTX, MA, STRA, GS, SOHU, DECK, BIDU, IBM LEH, MER, GRMN, V, CELG, UAUA, ESRX, NKE, BRCM Moving Down FSLR, MTL, CLF, IPI, X, NUE, CF, SCHN, JASO, MEE, POT, CNX, AGU, MON Intermediate Term Market Trend: Neutral to Breaking Out Today Short Term Market Trend: Up