Dow Jones Technical Analysis

On the daily chart below for the Dow Jones, we can see that once the market broke above the key resistance at 33538, the price started to consolidate going into Easter Holidays. Another good NFP report gave the buyers momentum to keep charging higher targeting the next strong resistance at 34477. The rally stopped last Friday as a miss across the board in the US Retail Sales report and a hawkish Fed’s Waller weighed on the sentiment. We may now see a bigger pullback if the bad vibes continue to reverberate onto this week. Dow Jones Technical Analysis On the 4 hour chart below, we can see that trading towards the next resistance the price was also diverging with the MACD. This is a sign of a weakening momentum and it’s generally followed by a pullback or reversal. The moving averages are still crossed to the upside and the red long period moving average and the trendline will keep acting as support for the buyers. This price action is also forming a rising wedge pattern that generally leads to a bigger correction towards the base of the pattern, which in this case would be the 33538 level. In the 1 hour chart below, we can see that at the moment the price is trading within an upward channel. From a risk management perspective, the best place for the buyers would be the bottom of the channel, so they can have a little risk on the downside and a bigger reward on the upside. The sellers, on the other hand, should jump onboard in case the price breaks below the lower bound of the channel and then target the 33538 support. This article was written by ForexLive at www.forexlive.com.
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