Was just reading about midtrend entry and pyramiding and one of the strategies was to use fibonacci retracement levels to enter the market again.
I had a though at decided to see how the Dow chart looks with a fibonacci retracement level drawn in.
The big move started in mid July 2006 and ended in Oct 2007.
Looking at the fibo levels, 12000 is the 61.8% level. Usually strong moves beyond this level would mean big trend reversals than retracements. From the chart, we can see that the Dow is currently flirting with the 12000 level.
In fact it breached the 12000 level in Jan and March but could not follow through. 12000 is definitely the inflection point for the Dow.
Similarly for the STI, 2900 is the 61.8% fibonacci retracement level which was breached in Jan and March.
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