A TECHNICAL UPDATE ON DOW JONES INDUSTRIAL AVG INDEX-26-3-2018

DOW JONES INDUSTRIAL AVG INDEX-

CLOSED AT 23533.20 ON 23-3-2018.

                                                                           

SUPPORT:-23509.06/23360.29/23242.75/22219.11/21673.58/21600.34/21471.14/21197.08

RESISTANCE:-24217.76/24534.04/24719.22/24809.35/24876.07/24977.60/25432.40/25449.15

(Figures in bold are important)

It seems that it has topped out at 26616.71 on 26-1-2018 and presently in correction mode and down by more than 3000 points from the top. It looks weak on the technical chart. It is making lower top & bottom, short term moving averages are on the verge of giving negative crossover and RSI is showing huge negative divergence on the daily & weekly chart which indicate that the downside is still open therefore it is likely to drift down further and can seek much lower levels in coming days/weeks & months, however in between relief rallies could be there.  

It is running below its short and medium term moving averages but presently running within its long term moving averages range which is between 24294---23264(it changes every day) for 26-3-2018 and as long as it holds the lower band of its long term moving average range there is a glimmer of hope that it may resume it’s up move again but if it moves below the lower band of the moving average i.e.23264 and sustain then it will be a potential threat to the long term uptrend till it bounces back above it again, finally and most importantly it is running much below its critical point of 24555.68 & 23962.56 and if it stays below it for some time then the down move may deepen, as of now the technical setup and indicators suggest that down move may continue with in between relief rallies. Moving down it may find good support at 23280.64/22320.59/22250.13/21293.36/21219.62/20993.52. It seems relatively difficult now for it to move up smoothly from here as it will face very stiff resistance in the range of 23962.56---24555.68---24876.07----25650 but it may steadily move up if it consistently sustain above 24876.07 on the closing basis. So 24876.07 will be the benchmark point for the year 2018.

In view of the above observation long trade can only be attempted if it move above its long term moving average range and sustain i.e. 24294(it changes every day) for 26-3-18, however aggressive trader can try long trade near its long term moving average lower band i.e. 23264(it changes every day) or on sharp decline but at appropriate levels for a pullback play. The overall bias is on the downside therefore sell on rise is suggested at appropriate points but not above 24294 for now or sell below 23264.  

REMARKS: -The long term up trend is threatened as it is running within its long term moving average range, therefore long trade should only be attempted if it moves above its long term moving average range upper band and sustain for few days. Short trade can be tried as suggested above. The overall technical setup is weak and indicates further downside in coming weeks/months.

Kindly note that make your cost your stop loss in favorable  trade and then trail it as the price move up/down to gain maximum profit and avoid losses. Use support and resistance levels as entry, exit, target and trailing stop loss points. DO NOT TRADE WITHOUT STOP LOSS.

Disclaimer:-The view expressed here are solely of the author and he is not at all responsible in any way for the outcome of the trade you enter based on the above view.

Note: Price stated here is of spot market.

Contact me for strategic guidance to enter and exit the trade.