The Dow Jones Technical Analysis - A Specialist in Technical Analysis

For Oct, 07 2014

(Individual Chart Analysis)

This is a no-frills analysis.  It is not designed to look good, it is designed to be effective. 


Summary of the Technical Analysis for the DOW

(This takes into account the near term, mid term, and longer term charts)

Our combined analysis for Tuesday tells us to expect the Market to begin the day with a bias to increase and if support levels hold it tells us to be ready for solid increases as the market makes its way to near term and midterm resistance levels.  The markets appear to already be in the process of doing this on a near term and midterm basis, and interestingly, after last week's test of longer term upward sloping support in the S&P, the market also seems to be doing this on a longer term basis too.  Support is inflection, but support was already tested and that opens the door to higher levels already, but if support breaks we should expect neutral support levels to be tested afterwards.  Keep in mind that the near term charts are upward sloping now.

Initial intraday trading parameters for the DOW exist between16980 - 17200
If 16980 breaks lower expect 16900
If17200breaks higher expect 18000
Otherwise expect16980 - 17200 to hold

If 16980 remains in tact as initial support, expect the market to increase to 17200. This reflects a tight near term down channel. However, and in line with our combined analysis, if 16980 breaks lower instead expect the market to decline to 16900 before it stabilizes again.


NEAR Term Analysis

Our combined near term analysis shows us that the Markets are in near term upward sloping channels and support levels were recently tested.  If support holds our combined near term analysis tells us to expect the Market to begin the day with a bias to increase, and to expect additional increases until the upward sloping resistance line, which is a higher level than Monday's high, is tested.  However, if upward sloping support breaks expect a pullback to neutral support, which would be modest in most markets.

NEAR Term Support for the DOW exists at 16980

NEAR Term Resistance for the DOW exists at 17180

Dow_5_day


MID Term Analysis

Our combined midterm analysis tells us that new neutral channels are developing, and the pullback that occurred on Monday actually identified an intra channel support level in most markets.  The lowest neutral support line was defined last week, but it is this intra channel support level that was defined on Monday that is inflection.  If it holds we should expect the Market to continue to increase until it tests the highest neutral resistance line in the midterm charts.  If intra channel support breaks lower another test of the lowest support levels should be expected instead.

MID Term Support for the DOW exists at 16925

MID Term Resistance for the DOW exists at 17222

Dow_30_day


LONG Term Analysis

Our combined longer-term analysis tells us that the Dow Jones industrial average and S&P 500 fell to test their respective longer-term upward sloping channels and thus far those are holding.  The markets are doing this without increasing to test the upward sloping resistance lines, so the probability of a break below upward sloping support is high, but breaks have not yet occurred and by rule we should expect support to hold unless it breaks.  In addition, in the NASDAQ and the Russell 2000 neutral support lines were tested, in those markets the upward sloping channels have already broken, but again, in the NASDAQ and the Russell 2000 neutral support lines held as well.  If the Dow Jones industrial average and S&P 500 break their respective longer-term upward sloping channels it will confirm breaks in all markets and open the door for aggressive declines, so longer-term upward sloping support in the Dow Jones industrial average and S&P 500 are our focal points.  Thus far they are holding.

LONG Term Support for the DOW exists at 16900

LONG Term Resistance for the DOW exists at 18000

Dow_1_year