$INDU Update for 05.25.2008

DOW JONES INDUSTRIAL AVERAGE - $INDU

Monthly chart shows bulls losing traction to take prices higher. What a difference a week makes. The bulls couldn't take the market higher, even to the .618 fib retracement level, but found major resistance right at the 50sma. This could be a lower high, but we won't know that until this month is over. The lower timeframes suggest that a retrace of the last move up is likely.

Weekly chart shows the strength of the bears, as they took back more than half of the gains made in the past 5 weeks. Look for continued weakness, and for a retracement of the last move up off the January low.

Daily chart shows the bulls were unable to take the market up above the 200sma. The index is now below all its key moving averages on the daily timeframe. Look for a retracement of the last move up off the January low. The up trendline in place is now broken. The whole move up off the January low looks to be corrective. IF this is consolidation, THEN look for new lows in the days/weeks ahead.