DJIA 3/24/09 - A 2 WEEK RALLY

TRENDS
(1) PRIMARY DOWNTREND | Prior Support 6469 | Prior Resistance 9088
(2) INTERMEDIATE DOWNTREND | Prior Support 6469 | Prior Resistance 8405
(3) SHORT TERM UPTREND |Prior Support 6469 | Prior Resistance 8405

MARKET REVIEW
(1) On 2/23/09 [DJIA 2/23/09 LAST LINE OF DEFENSE 2002 LOW] I said that the momentum of the Dow's decline "... could potentially make 6800 achievable." The index continued its decline and hit a new low of 6469 in early March 09.

(2) On 2/27/09 [DJIA 2/27/09] I also said that " It is not unreasonable to expect a correction to happen next week." which was the 1st week of March. On the 2nd week of March, the Dow started a 2 week rally that saw the index climb over 1300 pts. My timing was off by a week.

(3) It is worthwhile to note that a positive divergence presents itself early March 09 when the MACD exhibits a higher low just as the index marks a multiyear low. Consider this as an alert for a possible buliish reversal. Let the index play out and look for potential confirmation in case a reversal does unfold.

MARKET SENTIMENT
The primary and intermediate downtrends continue to rule. Until the chart presents evidence to the contrary, the current 2wk short term uptrend is merely considered an upleg correction of the declining intermediate trend. This rally is approaching potential resistance at around 8000 in the form of (a) a prior support during the minor consolidation from Jan to Feb 09, and (b) a 50% retracement of the 2500 move down from Jan to Mar 09. Keep an eye out for short term reversal signals that clues us in on the resumption of the downtrend. SELL ON RALLIES.