DOW 30: Technical outlook and review.

FX:US30   Dow Jones Industrial Average Index
Weekly Timeframe: The DOW has been trading beautifully within a nice-looking trending channel for over five years, and shows no signs of slowing down just yet. The recently closed weekly candle informed us that the buyers once again remained in control. However, at this point in time, the current weekly candle is showing rather aggressive selling interest from 17972; let’s see what the lower timeframes have to say about this.

Daily Timeframe: The daily timeframe shows that price closed below a daily demand area coming in at 17590-17689 yesterday, which in turn likely cleared the path down to a daily decision-point demand area seen at 17281-17427. The reason why we believe prices could decline this far is simply because of what price action is telling us to the left. Check out when price was rallying north, spikes south were also seen too (17527/17549/17590), this was likely pro money collecting unfilled buy orders to continue rallying higher, but what this also did at the same time was potentially clear the path south for future selling.

4hr Timeframe: In our previous analysis, we mentioned that for anyone who wished to sell around 17809 may benefit from waiting for lower-timeframe confirmation. There was a beautiful sell signal that came in the form of a fakeout above the high 17812 at 17815 around 01 .30am GMT time seen on the 30-minute timeframe. We actually missed this entry!!!!! Look at the potential risk/reward this trade would’ve created.

With the 4hr demand area at 17590-17637 well and truly consumed now, the next area of interest we have our eye on comes in at 17432-17469, a 4hr demand area that sits just above the aforementioned daily decision-point demand area. We are a little concerned about this area’s validity though simply because of the spike seen into it on the 06/11/14 at 17440, as this could have consumed serious buyers here. With that being said, we still feel there’s a good chance a reaction could be seen from here, and as such we are going to be watching for lower-timeframe buying confirmation around the 17481 mark.

Current buy/sell levels:

• Buy orders: 17481 (Predicative stop-loss orders seen at: 17415).

• Sell orders: Flat (Predicative stop-loss orders seen at: N/A).

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