DOW Levels:

The DOW looked like it was going to fall of a cliff and it didn't disappoint.

If the fear and capitulation continues then 11,250 would be my first downside target and below that it would be 10,853 (the 161.8% retracement).

Today the DOW confirmed that it is clearly still in an intermediate downtrend by putting in a definitive lower low. A relief bounce would certainly be in order within the next few days, but then it's completely up to the market to show the next move.

The pop over the downward trendline in May was a great head fake to the upside.

We always need to remember that downtrends have rallies and that these are often the best opportunities to take advantage of low risk short trades.

DOW 2 Year / Daily Chart: Ugly to say the least