dow break out level

Hi all. It's been a tough week and I'm down maybe 8% so far. I am hedging my portfolio by short selling the Dow via CFDs. Was working okay but the Dow is now back at my entry level. I'm not shorting the Dow to make money, but more as insurance. In doing so I will be less exposed to the emotions of watching my stocks fall.

The Dow since March has followed a very symmetrical pattern utilising the same downtrend angles that have had empowerment over the market until the lines are broken. Using this pattern I'm wanting to see the Dow break past 10,007 tonight to confirm a new breakout. Until then in my opinion we will see many sell into this rally. Last night's rally needed to break past 10,030. So with each day that passes the breakout level will drop. This coming Monday night the Dow will need to break above 9984.

The good aspect of the rally though is that it's based on good news form the USA. And it must be said that recoveries are always fraught with much scepticism, paranoia, conflicting views and numerous failed rallies as fear sometimes overrides optimism. As I've said once before, if all the data released was good enough to say everything is 100% then the market will rebound instantly overnight to where it started from. But the recovery journey will always take many scalps along the way, with many companies collapsing but with many new companies emerging as leaders.

I will continue to short the Dow while it remains below the trend line. Once above I will switch from short to long.

Happy trading to all.