DJIA Stock Market Technical Trend Analysis

Stock-Markets / Stock Markets 2019 Oct 31, 2019 - 06:26 PM GMT

TREND ANALYSIS

Short-term Trend Analysis

The Dow bounced from trendline support targeting resistance at 27,300 which it failed to reach before turning lower.The overall pattern is that of a converging triangle towards a breakout point. Where the ultimate direction of the breakout is not clear. The immediate trend targets the support trend line currently at around 26,000.

Long-term Trend Analysis

The past 2 years have seen repeated failures to decisively breakout to new highs resolving in significant corrections. Late last year's failure resolved in a major downtrend from 27k to 21.7k. Are we in for a similar fate this year?

TREND ANALYSIS - The Dow has now made 2 lower highs, whilst on the positive side continues to make higher lows. As is the case with the short-term chart the Dow is converging to a breakout from a converging triangle. Usually breakouts in the direction of the preceding trend.

RESISTANCE : There is heavy over head resistance above 27000 where each break above soon snaps back to under 27k.

SUPPORT is along a series of highs in the range of 26,500. So any decline should see a bounce of sorts from that level. Major support kicks in around 24k, and then we have the spike low of 21.7k.

TRENDLINES- Rising trend line supports from 21.7k are fanning out rather than holding price declines off the high which suggests a weakening trend.

The overall trend picture remains of limited upside with each attempt to go higher being knocked lower towards support.

MACD - MACD is bearish, lower highs and lows.

Formulating a Stock Market Update Forecast

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By Nadeem Walayat

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Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

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