MAY 5, 2010: How the Dow treats the 50 day moving average (green line) will tell us the probability of a continued roar upward or if a downtrending trading range is in the cards. If the 50 day moving average fails to support future lows, then a retracement down to 10,719 is the next major support level for a continued Uptrend.
If the 10,719 support is violated by a low daily close, the rally is over. Once this support failure occurs, a significant market retracement (even if a higher high occurs after this support failure) may occur -- let's say in the 4th quarter this year. History is on the side of this analysis.
Watch the 50 day moving average and 10,719.
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