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CHART: Time to get out the Dow 20,000 hats again as prices head lower

CHART: Time to get out the Dow 20,000 hats again as prices head lower

I’ve been banging on about the turn in the data flow across the globe and in the US recently and what it means for markets. Yesterday I showed the relationship between the falling Citibank Economic surprise Index and the S&P 500, bonds, and the US dollar index. What I

And even though it’s implied when I am talking in macro terms what I didn’t talk about yesterday was the outlook for the Dow Jones Industrial Average.

So with the DJ30 taking out the March low with this morning’s close at 20,404 (physical index) and thus break out of and below the range I thought it worth posting a quick look at the charts.

On the physical the close of 20,404 is below the 20,412 low in late March while the setup with the AxiTrader CFD is similar with the current price of 20,321 also below that late March low.

In both instances, prices are breaking down and my indicators are signalling that a move to the 38.2% level – just a garden variety retracement – of the Trumponomics rally.

That suggests a fall of at least another 500 points for both the physical Dow Jones Industrial Average and the DJ30 CFD.

Read more …

 

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About the Author

Greg McKenna

Greg McKenna

Greg is a trader, behavioural finance/economics guy and technical analyst. His trading methodology is based on a combination of these factors, more than 25 years experience of profitable trading and simple common sense money management and trade execution techniques.