A TECHNICAL UPDATE ON DOW JONES INDUSTRIAL AVG INDEX- 5.5.2020

DOW JONES INDUSTRIAL AVG INDEX

CLOSED AT 23749.76 ON 4.5.2020.

                                                                           

SUPPORT:23655/23645.30/23627.65/23531.31/23408/23344/23009.06/22941.88/22638.47/22262.24/21712.53/21600/21447.85/20893.41/20735/20553/20379/19845/19677.94.

RESISTANCE:24040.58/24120.78/24264.52/24490.37/24764.77/24965.77/25208/25372.70/25402.83/25507/25743.46.

(Underlined & bold figures are very important)

It topped out at 29568.57 on 12.2.2020 and then corrected sharply and made a bottom at 18213.65 on 23.3.2020 thereafter it rallied up again and made recent top at 24764.77 on 29.4.2020.

It is important to narrate here that from the top of 29568.57 it fell by 11354.92 points or by 38.40% and it took 28 days to make a bottom at 18213.65(both days inclusive) and then it rallied up again and made recent top at 24764.77(both days inclusive) it retraced by 6551.12 points or by 57.69% of the entire fall and took 27 days in this process. Since its fall and rise took almost same time i.e. 28 days & 27 days respectively and the up rally was quite decent and was very near to the Fibonacci retracement point of 61.80% i.e.25230.99, therefore it seems that price wise and time wise the pullback rally has possibly exhausted at 24764.77, if it is so then it has to fulfil certain condition in coming days which are mentioned hereunder:-

1. Sustained close below 23692.41 & 23655 is required; else it may still claw back to 24764.77 or above.

2. Sustained break below 23218.71 on the closing basis required to confirm that the pullback rally has exhausted and down move will begin.

   

Apart from the above conditions it is imperative to note that sustained break below 22638.41 on the closing basis will trigger sharp fall. Furthermore sustained break below 20893.41 on the closing basis will potentially indicate that it could retest or break the recent major bottom of 18213.65, which may please be noted.  

REMARKS: -The long term trend is down. The pullback rally seems to have exhausted so the down move should begin now provided the above mentioned condition are met. Therefore one should be cautious in both side trades as of now. The long term bias is bearish.

Kindly note that make your cost your stop loss in favourable  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.