DJIA : Risk of a correction this week.
Earnings are coming in thick and fast and are less than impressive so far, placing the Dow at some risk of a pullback to 12,150 or so and possibly down to nearer 11,850
• Momentum is decreasing, the market is struggling but the Dow can keep the trend intact for a while longer given any dip is met by fresh buyers – as has been the case for several quarters now.
• In terms of technical levels, use 12,116 to 12,150 as the first decent support. If it holds, fine, then a new high or at least a retest of 12,500 should be in store.
• However a breakdown below 12,100 should result in a pullback to 11,850 or near, so the week ahead does have more risk attached than seen since the Japan tragedy.