Using a top-down approach this morning, we can see that price action on the weekly timeframe has so far rebounded nicely from weekly support coming in at 16051. Moving down to the daily timeframe, however, price remains hovering between daily support at 15723 and daily resistance at 16705.
Turning our attention to the 4hr timeframe shows price currently flirting with the 4hr swap (resistance) level at 16475. Judging by the response seen at this barrier so far, and the fact that there is near-term 4hr demand (pink circle) lurking just below it at 16327-16392 we feel that offers here are weakening. In the event that a convincing break above this number is seen today, this could suggest further upside towards the aforementioned daily swap (resistance) level. Although the DOW is effectively being bought from weekly support (see above) at the moment, we see little reason why price will not bounce from this daily level. In addition, just below this level, there is a deep 4hr AB=CD pattern completion point at 16640 which could add weight to a possible bounce lower from here. Because of this, our team would consider trading a confirmed short from this zone today should the market reach this high.
Levels to watch/ live orders:
• Buys: Flat (Stop loss: N/A). • Sells: 16640/16705 Tentative – confirmation required (Stop loss: depends on where one confirms this area).