Not surprisingly, all of the action off of Monday’s low at 124.38 into this morning’s high at 125.64 has carved out an upleg that exhibits bullish form, which warns me that the recent decline from 126.10 to 124.38 represents a minor pullback within the still-viable post-July uptrend.  My expectation now is for the DIA to pause prior to another thrust to new highs above 126.10.  Let’s keep in mind, though, that Monday’s low at 124.38 represents the bull-bear line in the sand, which if violated should trigger sell signals and downside acceleration towards 123 support, on the way to 121.

Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com, a real-time diary of his technical chart analysis and trading alerts on all major markets. For more of Mike Paulenoff, sign up for a free 15-Day trial to his MPTrader Diary by clicking here.