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Short term tech­ni­cally side­ways to up. Strat­egy:

Traders take prof­its on a rally to­wards 12 650. In­vestors hold. • The Dow is trad­ing in a ris­ing chan­nel over the short to medium term (lines 1 and 2). The 40-day mov­ing av­er­age has pro­vided good sup­port near line 1. • The short-term con­cern is a neg­a­tive di­ver­gence on the rel­a­tive strength in­dex (RSI, on top; and on other os­cil­la­tors). That’s an early warn­ing of a cor­rec­tion to come. • The strat­egy for traders is to take prof­its on any fur­ther ral­ly­ing to 12 650 (while line 2 re­sis­tance is at the 12 700 level). Longer-term in­vestors should keep hold­ing US stocks if in, as the big­ger pic­ture is still good. Note: A clos­ing price be­low line 1 (12 470) will be a sig­nal for traders to sell short the Dow. The tar­get then will be 12 150. Ag­gres­sive traders can sell short off line 2, if

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