The Dow Jones Technical Analysis - A Specialist in Technical Analysis

For May, 05 2015

(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 looking for direction and it tells us to respect both initial support and initial resistance as inflection because they define a tight range and breaks either way could lead to more aggressive moves.  This is very important even though it sounds like a rather simple observation.  If initial support breaks lower it will suggest that the almost tests of midterm neutral resistance in the S&P 500 and dow Jones industrial average that happened on Monday could be enough to allow the markets to fall back to test midterm support lines again.  That would mean a rather aggressive decline, one that would be triggered if initial support as that is offered in our combined data tables breaks lower.  However, on the opposite side of the fence the resistance line in the initial channel defined by initial support and initial resistance respectively is equally as important.  If initial resistance levels break higher the markets are likely to take off and because there are no additional resistance lines above initial resistance, at least nowhere close to initial resistance levels, momentum market increases should be expected if resistance levels as those are defined in our combined data tables break.  Clearly, we have defined neutral boundaries, but unless support breaks lower or resistance breaks higher we should expect sideways action.  Eventually one will break, but until that happens moderate expectations for momentum moves.

Initial intraday trading parameters for the DOW exist between18064 - 18150
If 18064 breaks lower expect 17986
If18150breaks higher expect 19320
Otherwise expect18064 - 18150 to hold

If 18064 remains in tact as initial support, expect the market to increase to 18150. This reflects a tight near term down channel. However, and in line with our combined analysis, if 18064 breaks lower instead expect the market to decline to 17986 before it stabilizes again.


NEAR Term Analysis

Our combined near-term analysis tells us the market is in a rather tight near-term trading range and unless the market breaks out of this range we should expect the market to trade back and forth in a sideways manner between the stated near term support lines and the stated near-term resistance lines.  Momentum moves would require breaks of initial support or initial resistance, and there is a clear next level of support in our near term charts if the first level of near term neutral support breaks, but there are no additional resistance lines above the near-term resistance lines should the opposite happen and resistance breaks higher.

NEAR Term Support for the DOW exists at 18064

NEAR Term Resistance for the DOW exists at 18130

Dow_5_day


MID Term Analysis

Our combined midterm analysis tells us that the S&P 500 and Dow Jones industrial average came close to midterm neutral resistance lines without testing them officially.  The NASDAQ has plenty of room to increase before tests of midterm neutral resistance occurs there, and the Russell 2000 is yet to break above the intra channel neutral resistance line and is lagging the other markets considerably.  Everything considered, the market appears to have additional upside until such time as tests of midterm neutral resistance take place in the S&P 500 and Dow Jones industrial average, but it is important to note that the market turned higher after coming within close proximity of support without testing support officially last week, so there is a risk that the market began to pull back because it has come close to resistance somewhat like it came close to support last week.

MID Term Support for the DOW exists at 17764

MID Term Resistance for the DOW exists at 18157

Dow_30_day


LONG Term Analysis

Our combined longer-term analysis tells us that the markets all tested longer-term upward sloping support lines, and most of them held.  The NASDAQ, S&P 500, and Dow Jones industrial average each tested longer-term upward sloping support, the green upward sloping support line in our longer term charts, and all of those markets held.  The Russell 2000, on the other hand, broke below longer-term upward sloping support.  According to our combined longer-term analysis the market as a whole is likely to increase towards longer-term upward sloping resistance if longer-term upward sloping support remains intact.  Our combined longer-term analysis is therefore positive and will continue to be positive so long as longer-term upward sloping support remains intact in the Dow Jones industrial average, S&P 500, and NASDAQ.  Also, please notice that longer term upward sloping support is increasing every week.

LONG Term Support for the DOW exists at 17880

LONG Term Resistance for the DOW exists at 19320

Dow_1_year