To appreciate how useless technical jargon and charting can be, you need to read it line by line.
I will not disclose the author of the paragraph shown below in order to protect the guilty.
This 'insights' below were published early on Tuesday, Feb. 26, 2013, following Monday’s greater than 300-point intra-day negative reversal of the DJIA.
1) The analysts and commentators warning about a market peak could indeed be correct.
It’s hard to argue with that.
2) Perhaps a major top is in place.
What action does that dictate?
3) They could be wrong as well.
That’s always a possibility. What action does that suggest?
4) The market could be presenting a bear trap.
It might be. What action does that call for?
5) If support levels hold, or are temporarily breached…the market may move higher.
If the market doesn’t go down, and stay down, it may go up.
6) Any true breaching of the support level may indicate a significant correction.
If the market goes down significantly we might be in for a down market.
7) Plug your ears and watch the charts.
You will only know if Monday’s action was a buying opportunity or the start of a correction ... after it is too late to act on that knowledge.
The true value of the shares you can buy does not vary based on market action. In the absence of any negative company-specific news, lower prices are good for investors with money to commit.
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