Filling in the gaps

Last Friday (the 23rd) we saw the major indices open at levels substantially lower than those at which they had closed the prior day. If you kept a chart of the daily open, high, low, and close of these indices, there would be a gap on the chart between Friday’s opening level and the point marked by Thursday’s low. Significantly, the markets then reversed, with all the majors turning positive by the close except for the DJIA which closed down some, but remained above the 8,000 support level. Technically, such a reversal was to be expected since gaps are generally filled by subsequent trading, though not necessarily on the next day. Happening at this last bastion of support, we might consider trading on Friday as evidence of a key inter-day reversal. I know this is grasping at a slender straw, hardly one that seems capable of holding up under the weight of apparent global economic collapse, but it’s the only one I’ve got, so I’ll keep holding on until it either snaps or builds more confirmation. All said, that 8,000 level on the Dow has been amazingly resilient for the last couple of months.