The Dow Jones Technical Analysis - A Specialist in Technical Analysis

For Sep, 18 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 Thursday tells us to expect the market to begin the day with a bias to decline and it tells us to expect tests of near-term support so long as the resistance lines that were already tested remain intact.  According to our combined midterm analysis specifically, the S&P 500 tested midterm neutral resistance at 2010 and turned down from that exact level.  The Dow Jones industrial average is certainly trying to break out, it is trying to break out beyond 17,157, but thus far it has not confirmed a breakout either.  In order to confirm a breakout in the longer term patterns the Dow Jones industrial average will need to end the week above that level.  After Wednesday's trading session and the roadblock that seems to exist in the S&P 500 at 2010, the probability of a breakout in the Dow Jones industrial average does look questionable according to our combined analysis.  The fact that the S&P 500 turned down so precisely from 2010 makes that a very important inflection parameter and unless the market can move above 2010 it is headed back down to 1980 or lower.  Our combined analysis tells us to expect the market to begin the day with a bias to decline on Thursday, but support is actually inflection and downside confirmation accordingly.  If initial support levels remain intact the market may increase again to test 2010, but if initial support levels break lower it could open the door for much more aggressive declines given the tests of 2010 that has already occurred.

Initial intraday trading parameters for the DOW exist between16982 - 17161
If 16982 breaks lower expect 16341
If17161breaks higher expect 17250
Otherwise expect16982 - 17161 to hold

If 16982 remains in tact as initial support, expect the market to increase to 17161. This reflects a tight near term down channel. However, and in line with our combined analysis, if 16982 breaks lower instead expect the market to decline to 16341 before it stabilizes again.


NEAR Term Analysis

Our combined near-term analysis tells us that the markets have tested resistance.  From resistance, declines have already begun and if they continue our combined near-term analysis will tell us to expect a decline to near term support levels.  Support is inflection, and the ability or inability of the market to hold support will tell us if the upward sloping channels holds and the market reverses back to a higher high, or the support lines break and the Market confirms breakdowns.

NEAR Term Support for the DOW exists at 17125

NEAR Term Resistance for the DOW exists at 17250

Dow_5_day


MID Term Analysis

Our combined midterm analysis tells us that resistance lines were tested, but it also shows us that the Dow Jones industrial average is trying to break out.  The other markets are testing resistance; in fact the NASDAQ and the Russell 2000 are testing downward sloping resistance lines, while the Dow Jones industrial average flirts with a breakout.  However, all of these markets are less important to our combined midterm analysis at this time than the midterm chart pattern of the S&P 500.  The midterm chart pattern of the S&P 500 tells us that the market has tested its neutral resistance line and if that line holds the market is capable of turning back all the way down to the lowest level of neutral support (1980).  According to our combined analysis the S&P 500 is the most important midterm chart pattern, and if the S&P 500 is not capable of breaking above 2010 it is likely to turn down, back towards 1980 again, and pull other markets down along with it.

MID Term Support for the DOW exists at 16949

MID Term Resistance for the DOW exists at 17161

Dow_30_day


LONG Term Analysis

Our combined longer-term analysis tells us that the Dow Jones industrial average is threatening to break out.  The week is not over, the candles cannot be confirmed yet as a result, but the Dow Jones industrial average certainly is starting to break out and if that continues along these lines it will be a very bullish technical indicator.  However, the markets must finish the week higher, the Dow Jones industrial average must finish the week above 17157, for example, otherwise this bullish observation will not surface.  Our combined longer-term analysis tells us that the market is on the verge of offering bullish signals, but our longer-term candles are based on one week candles and the market will need to finish the week above 17157 for bullish signals to exist.

LONG Term Support for the DOW exists at 16341

LONG Term Resistance for the DOW exists at 17157

Dow_1_year