DOW JONES, Short-Term-Gap Filled, This Levels Are Important Now!

Hello Traders Investors And Community, welcome to this update-analysis where we are looking at 4-hour timeframe of the major stock-market-index DOW JONES, what it is building up the last times, and what we can expect the next times. In a previous analysis, I gave a free signal for the index with the small-term-gap to be filled which now reached its targets fully and properly within the schedule, now this fact does not mean the index is completely bullish and will continue in this manner but it has some meaningful possibilities to do this when it manages to confirm given scenarios, there are some important levels and signals which I found which can affect the outcome substantially.

As you can watch in my chart the index is trading in this important descending channel formation building a coherent upper boundary from its all-time-high to the previous highs established which it is currently testing to the upside, as the gap was filled and some supply entered the market the index is now consolidating between 26500 and 27000 which is overall a good sign that the index still holds this level. Furthermore, it has some decent support between the 26350 and 26500 levels which is marked in orange and building the lower range support below this level the index has also lower range support between 24700 and 24900 where it can bounce given within a solid likelihood.

Now given these results we can come to the conclusion that the index has two possible scenarios to play out before it confirms the upper gap to be filled. The first scenario will play out when the index holds the current level and manages to move above the falling resistance to confirm above it therefore it is from high importance that the index does this with a decisive high volatile move, the other scenario is that the index firstly falls below the support in the range and confirms the overall lower support before it climbs up and sets up to fill the gap. As there is still some solid support in the range of the first scenario, scenario A is more possible within a given possibility of 65 % and scenario B with 35 %.

This technical situation of the index does not alter the whole dynamic of the stock market which is currently trading in a speculative movement where many retailers enter the market while smart-money staying on the side-line. This can go some time but sooner or later the differences between the real economy and stock-market will be to be that either an adaptation of the two factors occurs or a shift into the bearish perspective again which can increase to the downside as there are many retailers in the market since the corona-breakdowns seen this year. The bullish short-to-middle-term perspective does not alter this fact therefore it should definitely not be kept aside, it will be highly interesting how this dynamic will develop.

In this manner, thank you for watching, support for more market insight, have a great day, and all the best to you!
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Information provided is only educational and should not be used to take action in the markets.

Comment:

ANALYSIS UPDATE: The DOW turned to emerge with the ability to hold the supports to continue with the final more possible 65% breakout in the range.

Since then the DOW reached all of the targets in the schedule.