DOW Go Boom!

Up 200 down 400... all in a weeks work. The DOW took a beating on Friday, but is now sitting in a fairly good support area. The chart looks terrible, but it is often these areas where it starts to look really vicious that it gets another bounce. It got a pretty nice bounce on Thursday after the doji, and with a 400 point day down it may be ripe for a relief bounce on Monday.

I'm not convinced we go down again on Monday. It may all depend on the news Monday morning. Any news construed as good could rocket futures up again. Remember that this market is very edgy right now but too both sides. You saw how bullish those bulls where last week with the NDX and RUT. They may have their tails between their legs this weekend, but they could easily be back next week.

If the DOW bounces on Monday, look for 12,418 as the first target which is a 23.8% retracement from the May 19th High to today's close. The key will be to see if it can hold above that level. If it can't then sideways to down would be the bias. If the DOW is week on Monday I'd see 12,028 as a support area (78% fib)

DOW Daily Chart: (Sorry for all the lines and fibs, but they're important)