DOW @ 14,000

Whether you understand technical analysis or not, it is very easy to understand the psychology of a resistance and support. It’s like a battle field. Resistances are supply points while supports are demand points. When supply points are overcome, the buyers overcome the sellers. This is positive (and vice versa.). This simple aspect attains more significance when the supply points are more than 10 years old. Markets are celebrating DOW 13,000 and even if this seems insignificant to the bears they should understand that the decade long supply point is now 8% away. Whenever that level breaks, all bullishness is going to break loose. Let’s see how much MAR can cause a real secular reversal. For us dips are marginal and accumulation opportunities. We wrote about it first in the Dow illusion on 4 Dec 2011. When we said Dow is headed higher and don’t let the dips trip you.