Morning Market Update for August 27, 2013

Tuesday's selling, a continued reaction to the Syria question, has the Dow trading at a minor support level. It will be important to see how the markets close Tuesday. Observing buying going into the close Tuesday, creating a hammer type signal in the Dow would indicate this minor support level is likely to hold. A close at the lower end of Tuesday's trading range would create a bearish J-hook pattern/falling off roof potential, taking the markets down to the lows of June. A close near the lower end of the trading range Tuesday would warrant closing out long positions that appear to have run out of steam. The failure of the Dow coming up through the 8ema revealed significant information. Investor sentiment has not turned aggressively bullish. Look at adding some short positions to the portfolio. Have a great trading day.