DJI made a fierce rebound on 31 Dec 12 upon nearing its low of 12,818 on 30 Dec 12, 7 pts away from its support of 12,811. The market respect the support very well on this occasion which coincided with the announcement pertaining to the fiscal cliff. This was followed by gap up on 2 Jan 13.
I quote my comments for DJI on 28 Dec 12 – “The Dow had a -158 on 28 Dec 12, Friday. It closed at 12,938 below the 13,000 pts which it has held above consistently for the past 1 month. DJ is still bullish at the moment while making retracement. Currently near to fibo 50% of the previous swing which is at 12,916. The index will likely to reverse at about this level or at the next lower support at 12,811.”