20070627 The cash DJIA made a dou bottom around our projected support level of 13009. Taking longs with this pattern at support on the ES and YM futures, turned out to be a good swing trade entry. Appropriate money management applies.

"The Dow rose 90.07, or 0.68 percent, to 13,427.73, after dropping 77 points earlier in the day. The blue-chip index had lost a total of 208 points in the previous three sessions.

Broader indexes also rose. The Standard & Poor's 500 index gained 13.45, or 0.90 percent, to 1,506.34, and the Nasdaq composite index jumped 31.19, or 1.21 percent, to 2,605.35."
Quoted from Yahoo finance: "Stocks Rally Ahead of Fed Rate Decision"

E-mini S&P 500 chart

20070622 Quoted from Yahoo Finance, "The Dow fell 185.58, or 1.37 percent, to 13,360.26. On Thursday, stocks had fluctuated before ending higher, with the Dow recovering 56 points following a 146-point tumble on Wednesday."

How best to trade this? Larry Pasavento postulates the AB=CD formation, which looks like the lightning bolt, to project possible buy point. Taking 1.618 of 146 point (Thursday decline) gives 236.23. Project down from Friday close gives a support level of 13309.6, about 50 points from Friday close.

E-mini S&P 500 chart

20070608 ES crashes, as long bond yields go above 5%. The short signal was actually on 20070607, close below the trendline.

E-mini S&P 500 chart