D-JONES, Bearish H%S Confirmed, These Are Imporatant Levels!

13 de mai. de 2020

Hello, Traders Investors And Community, welcome to this fundamental meaningful analysis about the current situation facing the DOW JONES INDUSTRIAL AVERAGE INDEX which is beside the SPX 500 and other indices one of the leading to represent the economy. As I mentioned already in past analysis about the SPX 500 the overall bearish bias in which we are trading should not be ignored and therefore we can expect heavy selling pressure to the downside the next time minimum on the short-to-middle-term basis. If you did not see this analysis already I recommend that you watch it to have a better overview of the current events happening in the stock-market:

Great, when looking at my chart we can see that DJI formed a confirmed bearish head and shoulder formation on the 4-hour time-frame. You can see the neckline marked in blue in my chart which is currently clearly crossed to the downside. Now there is a logical minimum target of the head and shoulder formation in play which is at the 22300 levels and confirms the overall completed head and shoulder formation plus target. Overall we can expect this target to be reached within the next price-moves as you can see it in my chart. After that, we can still anticipate more selling pressure at least testing the overall support-levels we have down there, the next significant support is at 21500 which you see marked in orange.

What is important to keep in mind is that the range between 20550 and 20960 is a paramount level to hold for establishing a further upward movement, when we break down this level there is a consequential possibility given that we will see lower levels because under that range there will be a high selling pressure, it can go as far that we test the major low at 18200 when this level is broken there is not much probability given that we confirm a bullish bias which exceeds in a new high therefore this scenario shouldn't be ignored. Overall we can say that when we hold the support in the range we can still move higher at least taking out the highs in the structure but this has to be confirmed properly otherwise there is still more downside to expect.

In the long-term perspective, the overall bias for stocks looks still bearish and there is not much possibility given for a continuation of the bull-market seen as before because the market was highly overbought and the world-economy still not recovered from the corona-shocks on the markets and many countries still struggling, we just need to look on the smartest investors like warren buffet who are bearish therefore it is good to focus on anticyclical investments like pharmacy, food or gold which can develop an up-trend and growth as profiteers of the current corona-crisis. In the next months, we need to acknowledge that a second wave of the pandemic can come which will cause serious economic damage, as traders or investors we need to prepare ourselves for that scenario and the rumors it can cause on the markets and its overall bearish shape this means to do not get overly bullish on the current snap-back and watch the situations further development.

Thanks for watching, support for more market insight and all the best!
Markets are a mixed favor in the modern economy.
In this manner: FAREWELL

Information provided is only educational and should not be used to take action in the markets.