Dow & The Swine Flu

The Dow continued its short term neutral trend today as it corrects 51 points.

The dreaded swine flu is beginning to get around the world as memories of the Bird flue epidemic returns. The flu virus just keeps getting stronger and stronger, putting pressure on an US economy that's struggling to come back from the recession. In fact, the swine flu coincided with all the technical resistance levels no matter what method you are using; fibs, elliot, MAs and even financial astrology. Already, investors are selling off on blue chips even though some of them had really good earnings report.

Even though the market is clearly under pressure, all 3 major indices are showing excellent resilience by holding above their respective 50DMA and maintaining their short term neutral trends. We will be watching for a strong break below the 50DMA as the first indication of a pullback.