As much as I want to be completely wrong about this idea, I think this could be it for the DOW. What I mean by "it" is there is a HUGE correction period lined up for the DOW which will last decades! The DOW looks like it has reached the top of its 5th elliot wave, which has caused massive gains all around the U.S. for individuals and the economy for years. Unfortunately, I see this as a ticking time bomb.
Ticking Time Bomb Signs:
1.) This is indeed the 5th wave which means we can see a correction of as short as fib level .382 (38%). However, that is very unlikely and we are looking at a correction on more towards fib level .618 (61%). Also, take into consideration how massive the DOW is. Just a 38% correction would be a major hit on the economy itself.
2.) Looking at the Stochastic RSI (indicator on the top of my chart) in the month time frame, the DOW has been operating at 100 RSI for a year straight. The Stoch shows you basically if markets/stocks/coins/etc are being oversold or over bought and everything in between. This has been an amazing year, almost unbelievable for the DOW. However, this is a sign of a major "snap back" coming.
3.) Now if you're not a user or don't know exactly what the Stoch is, the regular Relative Strength Index lines up with my analysis as well (indicator at the bottom of my chart).The RSI has NEVER been this high for the DOW, pushing up to 90 RSI.
4.) Another confirmation made was on the Macd. As you can see on the monthly and weekly (since the February is just starting) Macd, there is the down-tick supporting a downtrend accruing.
I have been keeping my eye on this for about a month now, maybe a little more, and have been waiting to see where the possible peak of wave 5 is. I believe it was at 26,500 in January. Once again, I hope I am completely wrong, because this correction could cause some economic problems and many jobs being lost. If you look back at the last corrections of wave 1 and wave 3, we had a depression lasting years and then two economic collapses in the other correction. If my analysis plays out, what we want to see is a slow gradual descent. Hopefully no major factors causing a large crash.
Let me here your thoughts...
s3.amazonaws.com/tra...shots/b/bjkHZCSR.png
Not taking into consideration the EMA's and volume, here is a weekly time frame supporting my analysis of the Stoch, Macd, and RSI.
Ticking Time Bomb Signs:
1.) This is indeed the 5th wave which means we can see a correction of as short as fib level .382 (38%). However, that is very unlikely and we are looking at a correction on more towards fib level .618 (61%). Also, take into consideration how massive the DOW is. Just a 38% correction would be a major hit on the economy itself.
2.) Looking at the Stochastic RSI (indicator on the top of my chart) in the month time frame, the DOW has been operating at 100 RSI for a year straight. The Stoch shows you basically if markets/stocks/coins/etc are being oversold or over bought and everything in between. This has been an amazing year, almost unbelievable for the DOW. However, this is a sign of a major "snap back" coming.
3.) Now if you're not a user or don't know exactly what the Stoch is, the regular Relative Strength Index lines up with my analysis as well (indicator at the bottom of my chart).The RSI has NEVER been this high for the DOW, pushing up to 90 RSI.
4.) Another confirmation made was on the Macd. As you can see on the monthly and weekly (since the February is just starting) Macd, there is the down-tick supporting a downtrend accruing.
I have been keeping my eye on this for about a month now, maybe a little more, and have been waiting to see where the possible peak of wave 5 is. I believe it was at 26,500 in January. Once again, I hope I am completely wrong, because this correction could cause some economic problems and many jobs being lost. If you look back at the last corrections of wave 1 and wave 3, we had a depression lasting years and then two economic collapses in the other correction. If my analysis plays out, what we want to see is a slow gradual descent. Hopefully no major factors causing a large crash.
Let me here your thoughts...
s3.amazonaws.com/tra...shots/b/bjkHZCSR.png
Not taking into consideration the EMA's and volume, here is a weekly time frame supporting my analysis of the Stoch, Macd, and RSI.
Comment:
The DOW had a nice bounce back after suffering a big hit over the last week. However, I see that the bears could dominate again in the near future.
For anyone checking this idea and following its updates, this is a long term Idea I will update here and there. I won't do too many daily updates and short trend patterns. With that said, here is an daily update with a few trend patterns.
s3.amazonaws.com/tra...shots/1/1FFCyuYT.png
Today was national ascending wedge day. Just kidding, but there was a ascending wedge inside a ascending wedge inside another wedge. Some crazy support lines held strong. However, this means we can see a downtrend ounce we break the support lines of the largest wedge. Which we did. Now we will wait to establish another support line when the market opens tomorrow morning. I see a major drop in the next 3 days.
For anyone checking this idea and following its updates, this is a long term Idea I will update here and there. I won't do too many daily updates and short trend patterns. With that said, here is an daily update with a few trend patterns.
s3.amazonaws.com/tra...shots/1/1FFCyuYT.png
Today was national ascending wedge day. Just kidding, but there was a ascending wedge inside a ascending wedge inside another wedge. Some crazy support lines held strong. However, this means we can see a downtrend ounce we break the support lines of the largest wedge. Which we did. Now we will wait to establish another support line when the market opens tomorrow morning. I see a major drop in the next 3 days.
Comment:
I am revisiting my analysis of the DOW and even though the fall didn't happen in 2018 after I posted this, I believe 2020 is that year. If you read my initial post I said back in 2018, "hopefully no major factors causing a large crash". I think its obvious what that cause could be now, Covid19! I'll revisit this post and give an update in a few weeks or sooner to chat if anyone wants to comment their thoughts on it. Feel free to object. I don't believe the DOW or the economy has a bright future. Once again, I HOPE I AM WRONG! However, one solid sign was a huge rejection to bearishly cross the 55 EMA. That is what the picture I posted above is referring to. If you trade using 55 EMA signals, this could be a bullish sign. (Unfortunately many more bearish signs)
It is hard getting back into this analysis because its a SUPER LONG TERM outlook on the DOW but I have one positive thing to say about the last few years leading up to this crazy time... THANK GOD Hillary wasn't elected during this crisis! haha
I am revisiting my analysis of the DOW and even though the fall didn't happen in 2018 after I posted this, I believe 2020 is that year. If you read my initial post I said back in 2018, "hopefully no major factors causing a large crash". I think its obvious what that cause could be now, Covid19! I'll revisit this post and give an update in a few weeks or sooner to chat if anyone wants to comment their thoughts on it. Feel free to object. I don't believe the DOW or the economy has a bright future. Once again, I HOPE I AM WRONG! However, one solid sign was a huge rejection to bearishly cross the 55 EMA. That is what the picture I posted above is referring to. If you trade using 55 EMA signals, this could be a bullish sign. (Unfortunately many more bearish signs)
It is hard getting back into this analysis because its a SUPER LONG TERM outlook on the DOW but I have one positive thing to say about the last few years leading up to this crazy time... THANK GOD Hillary wasn't elected during this crisis! haha
Confirmed Downtrend: Uh Oh! This is a 1hr time frame chart of the DOW. I would say its safe to say that this has confirmed the peak of wave 5 being at 26,500 in January. Obviously, today has not been a good for the DOW at all. A friend and I were looking at the 3 minute time frame and saw a 3.6% drop (855 points) in 9 minutes. That is $230 billion dollars!